EBRD promotes youth entrepreneurship in Morocco

• EBRD to lend €10 million to microlender Fondation Arrawaj
• Financing to support underserved young entrepreneurs in Morocco
• Facility to focus on recovery in areas affected by the 2023 earthquake

The European Bank for Reconstruction and Development (EBRD) is supporting young entrepreneurs in Morocco with a loan of up to €10 million (to be provided in local currency) to Fondation Arrawaj, one of the country’s leading microlenders.

The financing package is being provided under the EBRD’s Youth in Business programme to assist Fondation Arrawaj in on-lending to private micro, small and medium-sized enterprises (MSMEs) owned or led by entrepreneurs under 35 years of age. It will place special emphasis on those regions affected by the earthquake that struck Morocco in 2023.

MSMEs owned or led by young entrepreneurs present a unique market opportunity for the Moroccan financial sector and are a unique vehicle for increasing financial inclusion. However, they continue to face financing gaps, constraining their economic opportunities. It is estimated, for example, that only 14 per cent of young Moroccans have a bank account.

The facility will be accompanied by a comprehensive technical cooperation package to provide Fondation Arrawaj with capacity-building training to improve its ability to cater for the financial needs of eligible MSMEs, as well as results-based payments funded by the EBRD. The technical cooperation package will also include training opportunities for Fondation Arrawaj’s sub-borrowers, with a focus on digital and non-financial services.

The loan will further benefit from first-loss risk cover for sub-loans extended in the regions of Morocco affected by the 2023 earthquake.

Founded in 1996 under the name of FONDEP, Fondation Arrawaj is the third-largest microfinancing institution in Morocco. As at the end of March 2025, it managed total assets of close to €200 million and held a lending-market share of 19 per cent. It employed 1,942 staff at its headquarters and in its 256 branches across 15 regions nationwide, serving close to 120,000 clients.

Morocco is a founding member of the EBRD. Since 2012, the Bank has invested more than €5.8 billion in the country through 123 projects. The EBRD’s focus in the country is on supporting sustainable energy, the direct and indirect financing of private enterprises, infrastructural reform and non sovereign financing.