Joe Dinga Pefok (Uncle Joe)
In Cameroon, The Two Anglophone Regions Continue To Dominate The Microfinance Sector. But Despite The Large Number Of Microfinance Institutions In The Country, The Contribution Of The Sector In Financing The National Economy Remains Low. However, Microfinance Institutions’ Support To SMEs, And The Role They Plays As The “Poor Man’s Bank”, Are of Great Importance.
According to information from Cameroon’s Ministry of Finance, there is a large domination by Cameroon of the Microfinance Sector in the Central Africa Sub – region, precisely the CEMAC Zone comprised of six countries – Cameroon, Central African Republic, Chad, Congo Republic (Brazzaville), Equatorial Guinea and Gabon. Statistics from the Central African Economic and Monetary Union commonly known by the French acronym, CEMAC, shows that at least 60 % of Micro Finance Institutions in the sub –region, are in Cameroon alone.
Worthy of note, that in Cameroon, the microfinance institution is commonly known in the two Anglophone Regions, that is, the Northwest and Southwest Regions, as Credit Union, or better still, Cooperative Credit Union. It should as well be noted that the idea of Cooperative Society is more of an Anglo –Saxon culture, and that is why the two Anglophone Regions have over the years continued to dominate in the creation of Cooperative Credit Unions, officially known by the Ministry of Finance as Microfinance Institutions. It is in fact thanks to this culture of Cooperative Society that has spread to some other regions, that we see an increasing number of microfinance institutions springing up in three Francophone Regions – the West, Centre and Littoral Regions. It should however be noted that several of the microfinance establishments in the Centre and Littoral Regions, are subsidiaries of some microfinance establishments or credit unions in Anglophone Cameroon.
Long Period Of Laissez – Faire In The Management of Microfinance Institutions
It is also thanks to the privilege position of Cameroon, which benefitted from both the Anglo – Saxon and French Culture, that, the country has constantly and largely been dominating the other five member countries of CEMAC combined, in the number of microfinance Institutions. As aforementioned, the microfinance or cooperative credit union is an Anglo – Saxon Culture that, the other member countries of CEMAC have mostly copied from Cameroon or other Anglophone countries. This also probably explains why the Central African Banking Commission, commonly known by the French acronym, COBAC, as well as the Central Africa Financial Market Supervisory Commission (COSUMAF), were in the past seemingly not so focused or concerned with the state of the microfinance Institutions in the CEMAC Zone, like they have become today. For several years, there was a sort of laissez-faire in the management of microfinance establishments in Cameroon, as COBAC and COSUMAF, were seemingly not much involved in their policing role over these financial institutions.
COBAC And COSUMAF Have Finally Taken Up Their Responsibilities
But in the last couple of years, COBAC and COSUMAF have from all indications, fully taken up their responsibility over microfinance Institutions in the CEMAC Zone, as can be seen with their rigorous monitoring and supervision of these financial establishments. Quite a number of microfinance institutions in Cameroon have been faulted by COBAC and COSUMAF in the last few years for poor management, and a number of measures including sanctions, have been taken or netted out on some.
Ministry Of Finance Too Was Not Having Regular Updates
Cameroon’s Ministry of Finance too, has woken up from slumber on the issue of Microfinance Institutions or Credit Unions. In the past, the Ministry of Finance, MINFI, was in fact not paying much attention to the state of Microfinance Institutions in the country. This was clearly seen for example, in the fact that it was difficult or even impossible to contact MINFI, and be able to get the latest update on the number of microfinance establishments in the country. MINFI then seemed to focus its attention only on commercial banks or banks in general, including capital investment banks.
In September 2022 for example, the Minister of Finance, Louis Paul Motaze, was in Douala to launch an operation for Government to raise money through the sale of public bonds. The Mentor was present at the occasion. Copies of a booklet that was that was prepared for the occasion by the Ministry of Finance, was shared to investors. The booklet that was printed in June 2022 carried complete updated information on the situation of commercial banks in the country. But when it came to the microfinance sector, the information on the situation of the sector contained in the booklet, dated back to December 2020. Scandal! This meant that MINFI did not have the updated situation on microfinance institutions in the country, in the last one and the half year (2021, January – June, 2022).
Also, in an article published in June 2023, the President of PATRONAT SUD, Daniel Claude Abate, who also claims to be the President of an association of small and medium size enterprises in the country, disclosed that the last updated information which PATRONAT SUD, that was working on a project to create a microfinance establishment in the South Region, got from the Ministry of Finance, dated back to May 2022. It was of course a disturbing situation. It meant that the situation of the microfinance sector had had not been updated by the Ministry of Finance for the last one year. Suffice however to say the Ministry of Finance, like COBAC and COSUMAF, too has changed. This for example can be seen by the fact that in January 2026, the Ministry of Finance already had the updated situation of Microfinance Institutions in Cameroon, as by the end of December 31, 2025.
A Bulk Of Micro Finance Institutions Are Financially Weak
Meanwhile, though there are so many microfinance establishments or credit unions in Cameroon, a bulk of them are in the lowest category, which means that they are not financially strong. This weak financial situation of a bulk of microfinance establishments, in the country, means that the microfinance sector as whole does not have the capacity to contribute much to the financing of the national economy. For example, statistics from the Ministry of Finance showed that while as many as 415 microfinance institutions existed in the country by the end of 2020, the contribution of the sector to the financing of the national economy, stood at barely 10 %. The situation has however been gradually improving.
Commercial Banks Are Generally Unwilling To Grant Loans To SMEs
Studies show that 60 % of Cameroon’s economy is in the hands of foreign or multinational companies. This means that local enterprises, including State owned companies control only 40 %, that is, a minority, of the Cameroon economy. It is of course not good for a country, when its economy is largely in the hands of foreigners or foreign companies. A large majority of local enterprises are Small and Medium Size Enterprises, SMEs. The one major problem that local enterprises do face is raising funds to support the operation of the enterprises, or for their expansion. Commercial banks are generally unwilling to grant loans to SMEs, because of the issue of collateral security.
The conditions generally posed by commercial banks to grant loans to enterprises, are usually beyond the reach of most local enterprises, especially SMEs. A study that was carried out showed for example that commercial banks finance only some 11.5 % of small and medium size enterprises in the country. It should be noted that a majority of the commercial banks in Cameroon, especially those with big capacity to grant loans, are foreign or multinational financial institutions.
The Bank That The State Created For SMEs, Is More Dead Than Alive
The State, or better still the Government, created the ‘Banque Camerounaise des Petites et Moyennes Entreprises’, BC – PME, whose main mission was to grand loans to small and medium size enterprises in the country, that are predominantly in the hands of nationals. This was because the SMEs were finding it very difficult, or even impossible, to obtain loans from commercial banks. In fact the Government took the decision to create BC – PME, following the persistent outcry by SMEs that are mostly owned by Cameroonians that, commercial banks were not accepting to grant them, loans.
But despite the so much noise that the Government made about the bank (BC-PME) at its creation, the bank has not been able to do much, because of lack of enough capital. Many SMEs, as well as many members of the public, do not even know that the bank, exist. It is rarely heard of.
Microfinance Institutions’ Support To SMEs
Suffice to say many small and medium size enterprises in Cameroon today depend on microfinance institutions for loans, as commercial banks are not willing to grant the loans, on the grounds, or at times on the pretext, that they cannot provide the required collateral securities. Microfinance institutions which are owed by Cameroonians are much more considerate, on the issue of granting loans to the SMEs that are also mainly owned by Cameroonians. This is definitely one of the major reasons why the Cameroon Government, as well as COBAC and CPSUMAF, have unlike in the past, today taken more interest in the microfinance sector. A study that was carried out by the Ministry of Finance for example, show that local businesses or economic sectors like commerce (trade), restaurants, hotels, as well as the building and construction sector ( local contractors), depend to a large extent on microfinance institutions for loans.
“The Poor Man’s Bank”
In fact the importance of the Microfinance Sector in the country cannot be overemphasized. A large majority of members or customers of microfinance institutions in the country, are, the average Cameroonians that have very little. It should be noted that unlike with commercial banks that are owned by enterprises and personalities that pay millions or billions of francs CFA to become shareholders, microfinance establishments or cooperative credit unions are in principle owned by all the members. In principle, to open a saving account or whatever account in a Cooperative Credit Union, one must first of all register to be a member of the financial institution, by paying 100,000 francs CFA, which can even be paid by installment. That modest amount of money serves as the share of the member. This is why the credit union is commonly referred to as the bank of the poor (“The Poor Man’s Bank”).
As aforementioned, COBAC, COSOMAF, and even the Cameroon’s Ministry of Finance, initially did not look so concern about the situation in the Microfinance Sector in Cameroon, perhaps because comparatively, the sector does not contribute much in the financing of the national economy. But things have changed, as they have all seemingly come to realize the great importance of the microfinance sector to the society, considering that these financial institutions handle the little savings, as well as give out small loans, to the large majority of Cameroonians that are barely struggling for survival. So COBAC, COSOMAF and the Government, have all come to the conclusion that all must be done to protect members of microfinance establishments or credit unions, by stepping up their monitoring and supervisory roles over these financial institutions.
“When We Protect The Credit Union, We Protect The Poor”
In the countdown to the recent elective General Assembly in Bamenda of apparently one of the biggest cooperative credit unions in Anglophone Cameroon today, known as the Ntarikon Cooperative Credit Union Limited, NTACCUL, an interesting article, or better still, a correspondence, meant to sensitize members before the crucial election that was generating a lot of heat, appeared on the social media. The interest of The Mentor News in this article is excerpts of the write-up that truly talks of what a microfinance institution, or cooperative credit union, is supposed to be. Whether the author of the article practice what he or she wrote, is another matter. We know that in Cameroon there is often a big difference between theory and practice, by those in leadership positions at all levels. Even in our Churches today, many priests or pastors do not live their sermons.
MEANWHILE, BELOW ARE EXCERPTS OF THE ARTICLE OR CORRESPONDENCE THAT WAS ADDRESSED TO MEMBERS OF OT THE NTARIKON COOPERATIVE CREDIT UNION LIMITED, BEFORE THE RECENT ELECTIVE GENERAL ASSEMBLY, WHICH PAINTS A PICTURE OF WHAT A CREDIT UNION IS REALLY SUPPOSED TO BE:
“Dear members of Ntarikon Cooperative Credit Union
“Our Union is not just an institution, it is, a safe haven of the ordinary worker, the market woman, the teacher, the farmer, the young entrepreneur and the retiree who has entrusted us with their hard – earned savings”
“At moments of elections like this, emotions can rise and narratives can multiply. But we must rise above personalities and remain anchored on simple questions. Who can best protect the savings of our members and grow their dividends?”
“For many of our members, the money saved here represents school fees, hospital bills, business capital, and retirement security. A Credit Union is not a political playground. It is a financial sanctuary. And financial institutions survive only where there is stability, maturity, and institutional respect”.
“The poor who save with us do not attend private strategy meetings. They simply want their money, safe. They want dividends. They want access to loans when emergencies arise. They want a Union that is calm, stable, and well managed. We owe them responsible leadership”.
“The election is not about winning positions. It is about protecting deposits. It is about safeguarding dividends. It is about ensuring that no action, internal or external, ever threatens the stability of our institution again”.
“Let us choose leaders who respect processes. Let us choose leaders who understand confidentiality. Let us choose leaders who value unity over ego. Let us choose leaders who put members first”
“Fellow members, the future of our Union is in our hands. Let us vote wisely. Let us vote responsibly. Let us vote for stability, growth, and the security of every franc entrusted to our care. When we protect the Union, we protect the poor. When we protect stability, we protect dividends. When we vote responsibly, we secure our collective future”.
