NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

By Adhya Singh

Medical Credit Fund (MCF), one of the four nonprofit members of the Netherlands-based PharmAccess Group, recently raised a mix of equity and debt totaling EUR 32.5 million (USD 36.7 million) to “expand the Fund’s presence and support to healthcare providers in sub-Saharan Africa.” In particular, the new funding is slated for investment in small and medium-sized enterprises (SMEs) providing “primary healthcare services including malaria prevention…and maternal and child care” as well as developing the fund’s Cash Advance service, which allows healthcare facilities in Kenya to borrow online at an interest rate of 24 percent per year.

The funding includes a first-loss, equity injection of EUR 7.5 million (USD 8.5 million) from the Dutch Ministry of Foreign Affairs and a loan of EUR 2.5 million (USD 2.8 million) from Philips, a medical technology company headquartered in the Netherlands. The other investments are loans from the following development finance institutions: EUR 10 million (USD 11.3 million) from the UK’s CDC Group, EUR 7.5 million (USD 8.5 million) from Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO) and EUR 5 million (USD 5.7 million) from Swedfund. The US International Development Finance Corporation (DFC) will also participate with a guarantee of unspecified volume.

MCF, founded in 2009, works to “increase access to better healthcare services in sub-Saharan Africa for low-income patients” by financing for medical businesses that would otherwise find it difficult to acquire funding. As of 2020, MCF had a loan portfolio of USD 35.7 million. The NGOs of Amsterdam-based PharmAccess Group work in Ghana, Kenya, Nigeria, Tanzania and Uganda to expand access to healthcare by funding insurance and healthcare providers, promoting a high level of quality standards, and producing independent research.

Photo courtesy of Global.finland.fi.