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In Senegal, Proparco and Teranga Capital support the financial inclusion of entrepreneurs
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Proparco is providing a €1.5 million ARIZ PRIME portfolio guarantee to Teranga Capital to support the deployment of its €3 million investment portfolio dedicated to high-impact Senegalese Small and Medium-sized Enterprises (SMEs). This partnership reflects a shared ambition to offer alternative financing solutions to local SMEs in key sectors of the economy, such as agribusiness, services and technology, and energy access, by supporting a key player in the private equity ecosystem in Senegal and the wider sub-region.
Teranga Capital, a key player in impact investing in Africa, has been supporting the emergence of strong, local SMEs that drive sustainable transformation for nearly a decade. A member of the Investisseurs & Partenaires (I&P) network and active in several countries in the sub-region (Gambia, Mauritania, Guinea-Bissau, Cape Verde), Teranga Capital’s mission is to strengthen an entrepreneurial ecosystem capable of contributing actively to the economic and social development of the sub-region, with the goal of promoting African entrepreneurship while maximizing social and economic impact.
The ARIZ PRIME portfolio guarantee provided by Proparco is a risk-sharing mechanism that will allow Teranga Capital to invest in growth-stage SMEs requiring business development support and patient, long-term financing through equity investments. Teranga Capital specifically targets SMEs whose activities support sectors with high economic impact in these countries, including agribusiness, energy access, and information and communication technologies.
The provision of this guarantee to Teranga Capital falls under Pillar 1, “Investing in a Sustainable and Resilient Economy,” of Proparco’s strategy, through support for a private equity fund that specifically targets micro, small, and medium-sized enterprises (MSMEs) in sectors with strong developmental impact.
Moreover, by fostering the development of the Senegalese entrepreneurial ecosystem, this project is fully aligned with the French initiative Choose Africa, which aims to accelerate the growth and promotion of small and medium-sized enterprises across the continent.
“Proparco is proud to partner with Teranga Capital, a hands-on partner whose expertise in financing the ‘missing middle’ is well established. The deployment of the ARIZ PRIME guarantee once again demonstrates our commitment to reducing inequalities in access to finance and supporting the creation of stable jobs. This project lies at the heart of the Choose Africa initiative, illustrating our ambition to build a more inclusive and resilient African economy,” said Sadio Dicko, Regional Director for West Africa at Proparco.
According to Mohamed Ngom, Deputy CEO of Teranga Capital: “This portfolio guarantee enhances Teranga Capital’s attractiveness to investors by improving their risk coverage. It strengthens our capacity to mobilize additional capital to support high-impact SMEs and to continue our mission of developing a strong and sustainable entrepreneurial ecosystem in Senegal and across the sub-region.”