South Africa Financial Sector Program

Expanding financial services to 3,000 South African SMEs


2008 - 2013


USAID created the Financial Sector Program to create a more conducive legal, regulatory and financial services environment for small and medium enterprises (SMEs) in South Africa. Chemonics (prime contractor) subcontracted with Enclude to lead the access to finance component of the program.


Increase access to a range of financial services for small and medium enterprises in South Africa.



Facilitated more than 6,900 financial transactions for small and medium enterprises, totaling $160 million.

Structured over $200 million in portfolio guarantees as incentives for banks to expand their lending to SMEs.



Assisted 509 Black Economic Empowerment SMEs, previously designated as historically disadvantaged.

Completed an energy efficiency “road map” for the financial sector to highlight the opportunities for increasing financing for clean energy among SMEs.


Partnered with 12 financial intermediaries across all nine provinces in South Africa to improve or expand financial services for SMEs while mitigating risks and reducing transaction costs.

Designed and launched a variety of financial products responding to SMEs’ needs.

Enhanced financial sector professionals’ capacity to deliver services to SMEs through policy and process improvements to increase efficiency and reduce risk.

Structured over $200 million in Development Credit Authority (DCA) guarantees with local commercial banks to expand lending to SMEs.

Conducted a study evaluating opportunities for greater energy efficiency in South Africa. The study mapped existing public and private sector initiatives promoting energy efficiency in the private sector, specifically within SMEs. It also assessed the potential for energy efficiency within SMEs and identified subsectors that have the highest potential for achieving significant energy savings.


We learned that despite South Africa’s sophisticated financial market, banks continue to seek assistance in reaching the market more efficiently and profitably. Banks still require some risk mitigation in the form of guarantees to reach new customers, but with improvements in processes and lending approaches, they can expand their outreach. South Africa banks are now targeting new markets, including energy efficiency, agriculture, and other sectors that are dominated by small enterprises. Banks are seeking opportunities to tap into new markets to differentiate themselves in a highly competitive marketplace.

South Africa