The “Villes Secondaires” Project

Contexte & Objectifs

By a financing agreement whose objective is the extension of support to the development of microfinance in rural areas, signed on June 20, 2012; between the French Development Agency (AFD) and the Private Enterprise Credit Agency (LTN), the project called “secondary cities” is born. The agreement signed by the two partner institutions, amounting to 490,000 euros, equivalent to 321 million CFA francs, will be followed by a loan of 656 million CFA francs to the benefit of LTN Cameroon to refinance its investment portfolio. credit and enable it to deploy its activity towards actors operating in rural areas.

Thanks to these funds, LTN Cameroon really contributes to the financial inclusion of the rural populations of Cameroon, by allowing, besides households, small rural businesses as well as the modest populations to have access to credits. The grant also helped to build the capacity of LTN, which needed to adapt its products and procedures to the specific needs of the agricultural sector operators, but also to strengthen its teams that were to intervene in rural areas.

Competition in the financial sector in general and microfinance in particular being tough, it becomes imperative to evolve in innovative sectors especially in rural areas, keeping in mind an optimistic vision, that of setting itself in 2020 as the reference partner for the SME in Cameroon.

The innovations put in place

In November 2012, a team was set up to roll out the “Secondary Cities” project. It was led by LTN International, with the support of a permanent resident consultant in Cameroon. The pilot phase covered 5 agricultural basins, namely: Nkongsamba, Foumbot, Mbouda, Sangmelima and Bafia with a gradual extension to the surrounding departments. To better understand the specificities of the rural world, many innovations have been put in place. Among others we can mention:

• The specialization of some loan officers in the financing of agricultural activities; </ li>
• Adaptation of the network deployment strategy: LTN has implemented the concept of client concentration area which later evolves into relay points and counters, depending on the number of clients served in the area;
• The adaptation of products: this adaptation has gone through the setting up of credits adapted to the needs of rural entrepreneurs. So today we have at LTN agricultural credits to finance cultural activities,
  breeding, mixed and parallel credits to cover all the needs of rural populations throughout the agricultural season; by
  example: the financing needs of children’s schooling, financing of secondary commercial activity …
• The adaptation of value-added services to facilitate the use of banking products: in this sense, LTN launched the mobile collection of customer deposits from their home or place of business and the mobile transfer of refunds through the partnership that it has established with Express Union, a money transfer company that has more than 1000 points of sale in Cameroon, mainly in rural areas;
• The adaptation of the method of instruction of the credit files, by the simplification of the files of analysis of the requests of loan; and reducing distribution costs by setting up the pre-authorization system.

OVER 2,136 BILLIONS FCFA OF FUNDING IN RURAL AREAS

From the launch of the project in November 2012, until the end in December 2016, LTN Cameroon already accumulates 2,136 billion FCFA of financing in the agricultural field. The current credit outstanding of the rural cities being of 1.8 billion Fcfa (of which 852 million Fcfa in agriculture), which represents 10% of the total stock of LTN and with a good quality of portfolio . LTN would have given access to financing to more than 2,762 rural entrepreneurs, thanks to the innovations that have been put in place and implemented by a team of 59 internal employees. The culture of savings encouraged by LTN with rural entrepreneurs generated an amount of 437 million CFA francs.