Press Release - Wednesday, 14 July 2021
The Central Bank of West African States (BCEAO) through its training centre, the West African Center for Training and Banking Studies (COFEB), in partnership with AFREXIMBANK and the international factoring network, FCI, joined their forces to increase and improve the financing of the West African Monetary Union. It is within this framework that the BCEAO continues to promote various financing instruments, in particular factoring.
Factoring is a financial management technique that consists, for a company, in entrusting, within the framework of a contract, the management of its trade receivables to a financial company called a factor. This process allows the company to finance its receivables and recover the cash. The factor then proceeds, in return for remuneration, to the recovery of debts, the management of collections and the guarantee of customer risks. This financing technique particularly targets SMEs facing cash flow difficulties to finance their operating cycle or to meet their current operating expenses, and who have difficulty accessing conventional loans due to a lack of sufficient guarantees.
The work carried out by the BCEAO to diversify the financing instruments allowed the adoption of the Draft Uniform Law relating to the factoring activity in the WAMU member states by the Council of Ministers on 1 December 2020.
A DEMAND TO BUILD SKILLS FOR ACTORS INVOLVED IN AFRICAN IN FACTORING ACTIVITIES
In this context, the West African Center for Training and Banking Studies (COFEB), in partnership with AFREXIMBANK and FCI, has undertaken actions aimed at popularizing alternative financing instruments and facilitating the adoption of the Uniform Law on factoring, adopted by the Council of Ministers on December 10, 2020.
In this regard, a series of webinars, chaired by the Governor of the BCEAO, Mr Tiémoko Meyliet KONE, started on Tuesday 13 July 2021. As part of his opening address, Governor KONE was delighted to this joint COFEB-AFREXIMBANK-FCI initiative to organize a series of training webinars, the central theme of which is in the search for appropriate solutions for the adequate financing of economies, in a context characterized by limited access to bank credit the private sector, especially SMEs.
The first session, dedicated to central banks took place on Tuesday 13 July 2021. It will be followed on Wednesday 14 July 2021 by training for banks and financial institutions. Finally, on 15 July 2021, a final session reserved for microfinance institutions will also be organized.
The topics of these webinars relate in particular to the opportunities and challenges of factoring, the techniques of structuring factoring operations as well as their conditions for success. These sessions, which will take place online via the Zoom platform, in French and English (with simultaneous translation), offer credit and microfinance institutions the opportunity to better understand and take ownership of the key provisions of the Uniform Law on factoring in the UMOA.
Nearly 700 participants from all walks of life take part in these meetings. Among them, the agents of the central banks of ECOWAS, Maghreb, Southern Africa, and the Bank of Central African States, executives of banking and financial systems and microfinance institutions of the continent. Several high-ranking officials of partner institutions also participate, in particular the Secretary-General of FCI and the General Director of the Intra-African Commercial Initiative of AFREXIMBANK, President of the Africa Section of FCI.