Supporting Access to Finance for Micro, Small, and Medium Enterprises with Partial Credit Guarantees: The Moroccan Experience

This paper explores the various avenues of support available for Moroccan MSMEs for their sustenance and growth. It states that more than 90% of Moroccan enterprises are MSMEs and that they contribute to 21.6% of the country's total employment. Points discussed include:

• The Moroccan government elaborated a new national strategy in 2011 aimed at promoting the development of small enterprises. This includes a simplified taxation system, adapted social charges, extended social security coverage, and specific banking products;
• Morocco's Budget Law of 2011 introduced major incentives for small firms, including a reduction of the corporate profit tax from 30% to 15%, tax incentives for businesses that integrate into the formal sector, and tax incentives for sole proprietorships opting to transform into corporations;
• To provide a comprehensive set of financial services that reach individuals and MSMEs in underserved areas, a full-fledged postal bank has been established;
• Moroccan authorities have established the Caisse Centrale de Garantie (CCG), which is a public financial institution that provides partial credit guarantees (PCG) for loans to MSMEs;
• The World Bank through its Morocco MSME Development Project assists CCG by providing USD 50 million to support its PCG program.