Financial Systems

. Le groupe AFD s’engage aux côtés des institutions financières et des régulateurs du secteur pour construire des trajectoires économiques sociales et environnementales soutenables à long terme — © Oriane Zerah/Proparco

Our commitment

Actors in the financial system play an essential role in achieving the Sustainable Development Goals (SDGs) and in combating climate disruption. AFD Group works alongside financial institutions and regulators in the field to build long-term sustainable economic, social, and environmental trajectories.

Our approach

Many studies have highlighted the inherent fragility of financial systems in developing countries. These weaknesses include a lack of long-term financial resources, insufficient diversification of service offerings, weak risk management and governance arrangements, and limited monitoring capabilities.

In order to meet these challenges, AFD Group is committed to building stable, inclusive, and responsible financial systems. The Financial Systems 2018-2022 Strategy, in sync with the 2030 Agenda and the Paris Climate Agreement, is structured around three complementary objectives:

Promoting access to a suitable and diversified financial offer
Supporting the transformation of financial actors’ practices to promote a sustainable development model
Strengthening the architecture of financial systems to ensure their stability

To achieve these objectives, AFD Group uses a range of diversified tools and approaches, including loans, guarantees, and technical assistance grants.

AFD and financial systems: building inclusive, sustainable, and responsible financial systems

AFD Group promotes access to financial services adapted to the needs of groups historically excluded from such services - including rural populations, women, and Very Small and Micro Enterprises (VSMEs). Pursuing this commitment requires different types of support:

Providing dedicated financial tools to certain customer groups that are excluded from financial systems
Adapting the internal processes of financial institutions (risk assessment, investment policies, etc.) to target specific needs
Providing training and support to get to know certain customers and certain sectors better
Integrating the challenges of digitalization

To promote access to financial systems, AFD Group has rolled out a number of flagship initiatives:

The 2X Challenge initiative for the economic role of women
The AGREENFI label for supporting stakeholders in the agricultural sector
The Choose Africa initiative for supporting the growth of VSMEs in Africa

To go even further, AFD Group is redoubling its efforts to reduce inequality in its various forms.

AFD Group promotes the transformation of financial systems so that they may contribute to the development of a more sustainable economy.

AFD supports financial actors, particularly public development banks, in the development of their governance, strategy and internal processes. The objective is to contribute to a greater redirection of available financial resources towards the Sustainable Development Goals (SDGs), such as the fight against climate change and the reduction of gender and social inequality.

To this end, AFD is developing diversified technical and financial support adapted to the needs of financial stakeholders, to their level of maturity and operational context.

AFD Group participates in consolidating the governance of financial actors while also strengthening the institutional and regulatory framework in which they operate. Ensuring the implementation of appropriate regulations, securing financing transactions and protecting customers are the key challenges facing financial systems.

With this in mind, AFD supports financial regulators in adopting rules that contribute to achieving the Sustainable Development Goals (SDGs). These standards also aim to preserve the stability of financial systems in an environment where risks are increasingly numerous (e.g. climate risk, financial crises, conflicts, etc.).