By Hassan Koroma
The United Nations Development Programme (UNDP) Sierra Leone Country Office, in collaboration with the International Labour Organization (ILO), is implementing a European Union (EU)-funded project aimed at supporting the transition of informal enterprises toward sustainable growth and formalization in the African, Caribbean, and Pacific regions.
On Thursday, February 20, 2025, a matchmaking event was held at Sierra Palms Resort, Lumley Beach Road, to explore partnerships and enhance the use of blended financing.
In Sierra Leone, where 80% of the population remains unbanked, access to finance is a major challenge that has hindered individual and business development. Most operators in the informal sector lack access to banking services, limiting their financial opportunities.
The Government of Sierra Leone has made efforts to improve access to financial services, including establishing a collateral registry to encourage banks to accept movable assets as collateral. The National Financial Inclusion Strategy (2022-2026) prioritizes improving access to finance for micro, small, and medium enterprises (MSMEs), women, youth, and rural communities. A recent addition to this effort is the Youth Entrepreneurship Fund, launched by the Central Bank.
Speaking at the event, the Governor of the Bank of Sierra Leone, Dr. Ibrahim Lahai Stevens, emphasized the importance of blended financing in addressing financial inclusion.
He noted that the Bank of Sierra Leone is leading efforts to enhance financial accessibility and has worked extensively with the private sector to improve financial statistics. He praised the blended financing initiative for tackling one of the pressing economic challenges—transitioning informal enterprises to sustainable growth and formalization.
The UNDP Informal Economy Project aims to address challenges faced by the government, development finance institutions (DFIs), and other financial intermediaries by promoting blended finance partnerships with financial institutions.
Chief Director and Professional Head of the Ministry of Trade and Industry, Emmanuel Konjoh, thanked the European Union and all involved partners. He highlighted that the ministry’s strategic objective is to strengthen the private sector, as micro and macro businesses constitute approximately 90% of the economy.
He pointed out that financial incentives are often skewed towards large businesses rather than supporting small enterprises.
The blended finance study conducted during the event sought to determine the extent to which financial intermediaries could leverage blended financing to lend to the informal sector, thereby advancing financial inclusion.
Key stakeholders engaged in the study included government representatives, the Bank of Sierra Leone, financial intermediaries, DFIs, development partners, fintech companies, and informal sector operators.
The study assessed the viability of blended finance deals to meet the financial needs of the informal sector and evaluated their success. Furthermore, it provided a database of potential concessional funding sources and outlined key financial partners within the landscape.
