Microcredit was born in France following an encounter between Maria Nowak, an economist deeply involved in issues relating to development, and Muhammad Yunus, the founder of Grameen Bank. Following their meeting, in 1989, the former decided to launch the ADIE (Association for the Right to Economic Initiative), France’s first microcredit association. Since then, microcredit has emerged as an effective tool in France’s battle against unemployment: the formerly-unemployed today make up 70% of microcredit recipients in France.

There are two distinguishable types of microcredit in France: personal microcredit, which aims to increase the employability of borrowers, and professional microcredit, which finances an income-generating activity.

Why microcredit in France?


When the ADIE was founded, microcredit was still an unknown notion in France. But through perseverance, the association convinced public and private funders alike to commit to developing microcredit in France.

After initially using the solidarity guarantee method (for group loans) implemented by Grameen bank in Bangladesh, the ADIE came to realise that numerous recipients were not repaying their credit and that this method could not be applied to microcredit in France.

The association therefore decided to develop its own individual loan method.

From 1992 onwards, the association decided to make its services available to those individuals hoping to create their own business activity: in doing so, professional microcredit was born. Since then, several microfinance institutions (MFIs) have been established in France, notably Créa-Sol, a Microfinance Institution based in the South of France.

 

Microcredit in France: the numbers

According to data taken from the latest Microfinance Barometer, microcredit finances more than 30,000 professional projects in France every year and contributes to the creation of 60,000 jobs. Among businesses financed by microcredit, the 3-year survival rate is 75%. Half of the recipients of microcredit in France live below the national poverty line.