Photographer: Antje Heyn
In the last decade, ACGF (and its predecessor CGF-A) has achieved remarkable results in a highly challenging environment, while being among the pioneers of Small and Medium Enterprise (SME) finance in Afghanistan. Based on the available funding of less than USD 10 mln, cumulatively the following results were achieved as per the end of June 2018:

Business volume: a total of 4,800 SME loans with a value USD 200 mln have been guaranteed

Employment effects: 50,000 jobs were retained and 9,100 jobs have been created by the supported businesses

Portfolio quality: average historic net loss rate 1.2% p.a., an exceptional result in light of the challenging business environment

TA activities: introduction and further development of best practice SME credit technology, introduction and improvement of environmental and social risk management standards, improvement of counter-terror-financing and anti-money laundering procedures etc.

Partner Institutions (PIs) SME departments: up-scaling and down-scaling support for three banks and three micro-finance institutions, establishing and/or developing their SME credit departments with all related policies and procedures

Local know-how: establishing the expertise in SCSA, ACGF’s local consulting subsidiary. SCSA has also played a crucial role in training and mentoring the staff of the sister project in Tajikistan

Reputation: ACGF and SCSA enjoy very good reputation in view of the PIs and the donor community due to the successful and sustainable work and the very strong track record in the financial sector of Afghanistan

Success Stories

Biscuits and Beverages Production

The client had an established biscuit and beverages production business, where he worked with his eldest son and eight employees. As the demand for his products gradually increased in the market, he considered applying for a loan, in order to expand his production. Therefore, he approached the PI in 2012. His loan application was successful and guaranteed by CGF-A, based on the PI’s request. The client received a loan of USD 100,000. The client has successfully repaid the loan on time and his balance sheet grew by 25%. In 2016, following the success, the client applied for a further loan of AFA 5 million (approx. USD 72,000), in order to further increase his working capital. The PI applied for a guarantee and received it from ACGF. Overall, with the guaranteed loans the client managed to expand from eight employees to 67 and to significantly enlarge the number of clients. 

Flour and Wheat Importer and Wholesaler

The company is mainly involved in importing of flour, wheat, fuel and juice from Kazakhstan, Uzbekistan, Turkmenistan and Russia and sells to wholesalers and retailers inside Mazar-e-Sharif and other provinces. When it applied for the first loan from a PI, and was guaranteed by CGF-A, it was a simple and small trader, the company’s total balance sheet was around USD 420,000 and they had six employees. The company’s total balance sheet grew to USD 4.9 million with eight employees, enabling the client to take a further loan of USD 700,000 for which the guarantee was not required. The company has successfully developed further and established two more sister companies and a mill for processing imported wheat, hence, expanding it outreach and hiring more employees.

Water Tank Producer

Prior to applying for loan from the PI the company was a small tanker production company in 2008 when they applied for a loan amount of USD 80,000. At the time of applying for loan the company’s total balance sheet was around USD 478,000 and had 21 employees. After receiving a CGF-A guaranteed loan from the PI, the company’s balance sheet increased to approx. USD 4.1 million with eighty employees.

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