Medical Credit Fund (MCF), the only debt fund entirely dedicated to the African health sector, today announced the completion of a â¬ 32.5 million fundraising round from its second fund (MCF II) .
The tour de table was led by the Dutch Ministry of Foreign Affairs, which granted the initial equity injection of 7.5 million euros in January this year to meet the demand for credit during the issuance. COVID-19. CDC Group, with 10 million euros, FMO, with 7.5 million euros, Swedfund, with 5 million euros, and Philips, with 2.5 million euros, are also part of this fundraising. .
This funding round will help the Fund increase its presence and support to health professionals in sub-Saharan Africa, with a focus on primary health services, including malaria prevention and treatment, as well as health and maternal and child care. The funding will also be used to expand its fully digital loan product, known as âCash Advance,â which has grown rapidly over the past two years.
What you need to know about MCF
The Medical Credit Fund has granted more than 6,500 loans totaling over 120 million euros to African healthcare providers since its inception, with a 96% rate of return on investment. In Kenya, Ghana, Nigeria, Tanzania and Uganda, it reached 1,800 small and medium enterprises (SMEs) in the health sector.
The loans are combined with business development and quality support through the PharmAccess – SafeCare standards and methodology, which have helped 80% of businesses improve their services.
MCF will use the funds to expand its presence in sub-Saharan Africa, with a particular focus on developing digital lending products. Just five years after the launch of âCash Advanceâ, MCF is currently using digital loans for 80% of its disbursements.
Cash advances do not require collateral as the loan is secured by the provider’s history of mobile money receipts. Digital income is used to pay off debt in full. Kenyan customers praise the many refund options as well as the speed and simplicity of the transaction, which is done entirely using their mobile phone.
MCF will also benefit from a guarantee facility provided by the United States International Development Finance Corporation (DFC), which was established by the Health Finance Coalition (HFC) with support from the President’s Malaria Initiative. (PMI) and the USAID Center for Innovation. & Impact (CII). The MCF, which leverages catalytic funding from public and private sources, aims to reach â¬ 80 million over the next few years through blended funding.
What they say
Arjan Poels, Managing Director of MCF, commented on today’s news: âI am very grateful for the support we have received from our investors, in particular from the Dutch Ministry of Foreign Affairs. The funds will help fill the funding gap for small and medium-sized health enterprises, enabling entrepreneurs to finance construction work, purchase equipment and avoid drug stockouts. Alleviating the chronic underfunding of the sector means that more patients can receive better health care. ”
Clarisa De Franco, Managing Director and Head of Private Equity Funds, CDC Group, said: âAffordable, reliable and quality health care has never been more crucial than it is today. That’s why CDC is excited to deepen its partnership with MCF, an impact-focused fund manager with a proven track record in supporting the primary health care sector in Africa. Our commitment to MCF II will enable the Fund to increase its flexible financing offerings to an estimate of over 2,500 healthcare SMEs, thus strengthening their ability to meet the growing demand for quality healthcare and serve approximately 10 million patients by 2030. Strengthening Africa’s health system is an immediate priority that requires dedicated health care funding to help close the funding gap in the market. CDC’s engagement alongside investor partners will serve the dual purpose of stimulating the growth of the health sector in Africa and it will act as a positive signal to the market, attracting even greater investments to scale up companies. inclusive quality health care for millions of people across Africa.