ADA promotes the development of inclusive finance in Tunisia

ADA has completed a three-year project to promote financial inclusion in Tunisia. It boosted the capabilities of the country’s authorities in the inclusive finance sector, which in turn facilitated access to financial services for the Tunisian population.

The project provided financial education for certain segments of the population and the general public, improved protection for the clients of microfinance institutions (MFIs) and created a new micro-insurance product tailored to their needs. It also laid the foundations for creating a refinancing fund for MFIs to further boost financial inclusion in the country.

This project builds on a previous technical assistance initiative by ADA between 2012 and 2018 in collaboration with the European Investment Bank. This initiative contributed to structuring the inclusive finance sector in Tunisia in alignment with the national financial inclusion strategy for the period from 2018 to 2022.

Boosting the financial skills of vulnerable groups and the public

According to the 2018 National Survey on Financial Inclusion, almost 40% of Tunisians aged 18 or over were financially excluded, with higher rates of financial exclusion among women and people living in rural areas. The survey also revealed that public perception of formal financial institutions was negative. To address these challenges, ADA supported the development of a national financial education programme by the Observatory of Financial Inclusion. The programme included training of trainers to boost financial knowledge among rural women, videos on social networks, television programmes targeting children under 12 and a radio campaign giving advice to financial service users.

By the end of the project, 236 trainers had been trained, enabling around 3,500 women in rural areas to receive financial education. By May 2024, the educational videos had accumulated more than 2.4 million views on TikTok and 87,000 on YouTube. The radio advertisements aimed at the public had been played more than 20,000 times on Facebook.

Improving protection for microfinance clients

To improve the protection of MFI customers, ADA supported the creation of a centralised complaints platform, allowing any prejudicial or unfair treatment of MFI customers to be reported. This tool, managed by the Microfinance Control Authority, will help to improve the quality of services by MFIs for the benefit of their customers.

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Launching a micro-insurance product: a first in Tunisia

A national survey conducted as part of the national financial inclusion strategy revealed that the financial products offered by MFIs did not fully meet the needs of most of the population at the time. In collaboration with the Tunisian MFI DAAM, ADA introduced a new, professional, multi-risk, micro-insurance product aimed at reducing the risks to which microenterprises are exposed by providing them with cover that is compatible with their financial means. Other institutions are expected to develop similar products soon.

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Increasing the financial resources of MFIs

To enable easier access to credit for vulnerable populations, ADA supported the preparations for establishing a refinancing fund in collaboration with the Ministry of Finance. The fund aims to facilitate lower-cost financing for MFIs and to strengthen their capacity to serve more risky sectors such as agriculture, the green economy transition as well as clients excluded from traditional financial services. With the support of national and international experts, the articles of association and a business plan for the fund were drawn up as part of the project.

Outlook

The project created a solid basis for the development of the inclusive finance sector in Tunisia. The impact of the practical skills and tools provided will depend on how they are put to use by local authorities.