Senegal: Official launch of SME rating platform eRating

May 14, 2015

It is expected to improve the eligibility of SMEs to bank financing.

In Senegal, the Agency for the Development and Support of Small and Medium-sized Enterprises (ADEPME) officially launched on Tuesday, May 12th an online SME rating platform named eRating.

According to Soyibou Ndao, of ADEPME, this platform should improve the eligibility of SMEs to bank financing by strengthening businesses' management, legibility, visibility and monitoring.

"eRating can be used to assess the ability of the SME to meet its financial commitments over a period of three years," he said, quoted by Lejecos.

The platform uses two instruments. The first is a financial analysis instrument using criteria such as ranking to assess the solvency, profitability and liquidity of SMEs. The second is a scoring tool that helps identify the specific risk of each SME and its probability of default relative to the overall risk of its industry.

SMEs account for 90 per cent of Senegalese companies, contribute up to 33 per cent to the country's GDP and employ 42 per cent of the population. Despite these figures, these companies still experience significant difficulties in accessing credit.

According to ADEPME, this platform should help to get rid of the asymmetry of information between the banker and the company's boss.

Around 80 per cent of credit applications are rejected by banks partly because of this asymmetry, said Abdoulaye Gaye, from the Observatory on Financial Services Quality.