Microfinance and Small Projects in Egyptian Society
There is no doubt that economy mainly depends on the domestic product. The Egyptian government seeks and tries to overcome the obstacles in the way of increasing domestic production in order to improve the Egyptian economy quality through regulations and facilities for investors from all classes and groups of the society so as to encourage the trend towards investment and production, improve their standard of living, and strengthen the economic power due to its huge return to all citizens.
The Egyptian state believes that the solution towards raising the domestic product is carried out by supporting the development and formation of small and medium enterprises. In 2014, a law was created for microfinance, and the supervisory authority controlling these microfinances drafted executive decisions and the necessary control measures and defined requirements to facilitate all processes, including the licensing process, for all companies and private associations.
In 2020, some laws have been amended and the name of the federation has been amended to the Egyptian Federation for Financing Medium, Small, and Micro Enterprises to ensure institutional efficiency, financial sustainability, and protection of the beneficiaries' rights in order to motivate all citizens of the middle and poor classes to take bold steps towards starting productive projects helping them improve their living standard and generate great benefit to the Egyptian economy through reducing unemployment, increasing the volume of investment, and encouraging low-income groups to contribute to economic activity.
In order to smooth the borrowing process, the Egyptian government has been keen on diversifying microfinance companies including a lot of branches - Islamic and others - in all governorates, with different benefits from banks to private associations to private microfinance companies, providing service assistance, such as feasibility studies and easing project procedures.
General statistics indicate the role of microfinance in Egypt, where, in 2022, the number of beneficiaries of financing activity reached 3.5 million, and 28.8 billion Egyptian pounds is the financing balance. It was divided into 19% for agricultural activity, 60.5% for commercial activity, 13.5% for service activity, and finally 7% for productive activity. Obviously, these statistics show the activity development to a large extent.
Wafaa Abdel-Aal is an Egyptian woman owning a ready-made garment manufacturing project in Port Said city, northeastern Egypt, on the Mediterranean Sea. She has obtained a two-part loan to implement her business in the amount of 10,000 pounds. "The first part was to provide sewing machines for the project, and the second part, with half the amount, was given to her in cash, as the project is a small sewing factory." Wafaa indicated.
Today, she owns many times the number of machines she had in the beginning. Furthermore, she has increased her number of employees, especially females. Wafaa said, "my project today has a more excellent societal and economic value than before, and I care about quality and exhibiting the Egyptian product in a more professional way to compete in the local market, hoping to be able to export the products I produce to the regional markets".
Wafaa concluded that Egyptian women today are practicing many commercial activities on an equal basis with men, and that microfinance provides ideal opportunities to help women, particularly to think about building their own projects in various fields that positively serve Egypt.
