MasterCard Foundation Launches $200 Million Fund to Invest in Early Stage Africa...

Mastercard Foundation has launched a $200 million Africa Growth Fund (MFAGF) that targets early-stage, growth-oriented SMEs across Africa.

We’re proud to announce the launch of the Mastercard Foundation Africa Growth Fund, a bold initiative that works through African fund managers to support early-stage, growth-oriented SMEs on the continent. Find out more about our mission on our website https://t.co/n2sxVfiLpO pic.twitter.com/EjJCOGUqCV

— Mastercard Foundation Africa Growth Fund (@africagrowthfnd) December 2, 2022

The fund will invest through different investment vehicles having already recruited two investment vehicles supporting entrepreneurial activity, one in East Africa and one in West Africa.

MasterCard Foundation is looking to address 2 key problems facing entrepreneurship in Africa:

• Under capitalization of African-led investment funds
• The lack of financing for African SMEs

According to the organization,  African investment vehicles are typically considered high-risk while African SMEs struggle to access the financing they need to scale, inhibiting their potential. “This fund-of-funds will strengthen and empower a new crop of African investment vehicles to drive decent job creation for women and youth via investments in small and medium-sized enterprises,” said Dr. Dorothy Nyambi, president and CEO of MEDA.

Besides funding, the Africa Growth Fund will offer a business development facility for its portfolio companies while using gender-lens investing (GLI) principles to realize its objectives.

According to the fund’s Managing Director Samuel Akyianu, its main objective is to make investments that generate positive, measurable social and environmental impact while contributing to building a stronger and more vibrant African investment ecosystem.

“The MFAGF has built up a pipeline of 180 diverse investment vehicles, including Early-stage, Growth, Debt and Seed VC Funds and other non-traditional funds. Five have gone through the fund’s investment screening process, two female-led investment vehicles are past due diligence and said to have received a favorable investment decision.” 

The fund has an investment committee made up of financial and investment experts drawn from various parts of Africa:

• Hamdiya Ismaila => General Manager at Venture Capital Trust Fund/Ghana
• Kanini Mutooni => Managing Director at Draper Richards Kaplan Foundation
• Dr. Frank Aswani => CEO of the African Venture Philanthropy Alliance (AVPA)
• Lumka Mlambo => Fund Principal at the South Africa SME Fund
• Mercy Mutua => Head of Access to Finance at the Mastercard Foundation

The Fund-of-Fund’s vision is implemented by a consortium of partners, including Investisseurs & Partenaires (I&P) and Entrepreneurial Solutions Partners (ESP), Genesis Analytics, the Criterion Institute, and Africa Communications Media Group.

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Kenya’s Joint Financial Sector Regulators (FSRB) have resolved to work on recommendations for the establishment of an oversight framework targeting crypto assets, players, and activities in Kenya.

In a statement published by the Central Bank of Kenya (CBK), the group, which consists of 5 regulatory bodies indicated that their action was in response to a ‘recommendation’ from the Kenya Ministry of National Treasury and Economic Planning.

Communique on the 13th Joint Financial Sector Regulators' Board Meeting pic.twitter.com/E6Sa1Jzg1U

— Central Bank of Kenya (@CBKKenya) December 16, 2022

The group also wants to coordinate the development of a framework for promoting the adoption of technology and innovations in the financial services sector so as to help them with effective regulation and supervision.

FSRB’s main role is to enhance how the respective organizations collaborate in mutual areas including legal and policy issues, regulation and supervision, and information sharing. The members include:

• Capital Markets Authority (CMA)
• Central Bank of Kenya (CBK)
• Insurance Regulatory Authority (IRA)
• Retirement Benefits Authority (RBA)

In October 2022, CBK Governor, Dr. Patrick Njoroge, said they were keen on regulating cryptocurrencies because they are apprehensive of the fast pace of growth in the sector and what this could mean for consumers.

“The point is, like all asset classes, one needs to regulate it in some way to make sure that this is something that not only makes sense but whoever is involved in it it doesn’t bring in the other evils and negatives that actually could very easily open the door to if left unchecked.” – Governor, CBK 

He has previously also said he would be crazy to let Kenya add bitcoin to its reserves reiterating that cryptocurrencies need to pass a test as to what they are solving.

However, the Governor has insisted they are not trying to get in the way of innovation. Together with the other members of the board, they will be submitting recommendations to the ministry headed by the new minister and immediate former Central Bank governor, Prof. Njuguna Ndung’u.

Ndung’u is thought to be more open to crypto, and enthusiasts in Kenya have been keeping an eye on his actions during his tenure in the Kenyan government.

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