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Africa Economic Institute

Joint Forces Create Opportunities in Ghana

SAP and PlaNet Finance joint forces to offer technology and finance support to microfinance institutions (MFIs). The two companies are focus to stimulate the microfinance division by using new technology (SAP) and microfinancing towards sustainable businesses. Three main areas will be targeted: technology development for field initiatives, development of software…

SAP and PlaNet Finance join forces to offer technology and finance support to microfinance institutions (MFIs). The two companies are focus to stimulate the microfinance division by using new technology (SAP) and microfinancing towards sustainable businesses.

Three main areas will be targeted: technology development for field initiatives, development of software solutions for MFIs and deployment of SAP technology for PlaNet Finance’s corporate initiatives. In addition, SAP will use its associations with its customers, partners and developers - known as the SAP ecosystem - to provide expert assistance.

PlaNet Finance Group is an international non-governmental organization whose mission is to fight against poverty through the development of microfinance. microfinance provides financial services to people below the poverty line excluded from the banking system.

“Our mission is to further the development of microfinance through the creation of programs and tools that encourage best practices in the sector,” said Jacques Attali, president, PlaNet Finance. “More than eight million people in nearly 80 countries are currently beneficiaries of funds provided by PlaNet Finance’s network of MFIs. With new technologies, the network’s impact will be even greater. “He added.

SAP is the world’s biggest business software company and the third-largest software supplier overall. By deploying the ultimate technology, services, and development resources, the company delivers  businesses platforms  and  improves supply chain efficiencies. Also, it offers applications and services that enable companies of all sizes and in more than 25 industries to become best-run businesses.

The first join forces’ project is the shea nut value chain in Ghana. They begun to study how technology, microfinance and education can improve the women’s lifes. The two companies saw an opportunity to help Ghanaians to produce shea butter, used  in food and cosmetics. The joint initiative will develop groups of shea nut harvesters and provide them training on how to effectively work together to help drive maximum success. Women will also be trained in after-harvest nut treatments and improved techniques for shea butter production.

“SAP and PlaNet Finance share a commitment to helping people find the best way to run their businesses,” said SAP CEO Leo Apotheker. “SAP believes that with the right partners the private sector can significantly contribute to the development of underserved markets worldwide. Our goal is to help organizations that face significant barriers to growth become profitable and sustainable businesses. SAP and PlaNet Finance will work to bridge the digital divide and bring the benefits of technology to those without access to it. With the assistance of the SAP ecosystem, we will also improve the technology supporting PlaNet Finance’s own operations and those of its network, so that they can better serve entrepreneurs in emerging markets.”

Microfinancing is the provision of financial services, especially credit, savings and insurance, to the disadvantaged. By offering small loans to budding entrepreneurs and business collectives, the lending organizations have a positive impact on an individual level, providing people with an opportunity to break out of extreme poverty. This also helps to develop sustainable economic growth in emerging markets. 

The collaboration between SAP and PlaNet Finance is part of SAP’s long term commitment to sustainability, and more particularly to corporate social responsibility. SAP will provide PlaNet Finance with the appropriate software solutions and implementation support, which will help enable the organization to optimize business operations and processes in the areas of financial management, human resources, project management, business intelligence and knowledge management.
Microcredits, or very small loans, were pioneered by Grameen Bank founder Muhammad Yunus in Bangladesh as a way of helping the rural poor to start up economic activities with which to earn their way out of poverty.

PlaNet Finance supports a number of microfinance institutions around the world, providing them with consulting services and loan portfolio management software to help them run more efficiently.

SAP will contribute software, expertise and a little bit of cash to PlaNet Finance’s work, SAP CEO Leo Apotheker said in a conference this week.
Microcredits  rates are a function of the size of the loans. Small loan costs just as much to administer as a large one. In addition, it is difficult to keeping in touch with clients in rural areas where communications are poor.
While the new software version will go some way toward cutting costs by simplifying administration, it won’t do much for improving communications with the remotest areas.

After years of seeking small loans from loan sharks, family members and non-profit micro-credit programs, Ghanaians now have what they never had before: a full-service commercial bank for the poor.

The borrowers are primarily women that can open savings accounts, getting small loans (around $100).

 “We teach them that these people pay their salaries,” said Benjie Montemayor, who heads Opportunity International’s network of commercial banks in Ghana. “Helping the poor doesn’t mean you need to have poor facilities. Our borrowers are our clients, not our beneficiaries.”