National MSME Finance Expert for Consulting Services for the Innovative Approaches for the Financial Inclusion of MSMEs in Jordan

Background:

Ninety eight percent (98%) of companies in Jordan are micro, small, and medium-sized enterprises (MSMEs), defined as companies with fewer than 100 employees. They employ around 70% of the workforce in the private sector, but their access to finance is inadequate: only 10% of all bank loans were granted to MSMEs, which is a low figure even by regional standards. Larger banks have little experience with financing micro and small enterprises and tend to approach them in the same way as large companies. At the same time, trust in and expectations of the financial sector tend to be low, as MSMEs often do not feel addressed by financial institutions. Supporting instruments such as loan guarantees from specialized institutions are available, but financial intermediaries are sometimes reluctant to use them, partly because of lengthy processes.

The Jordanian government and the Central Bank of Jordan (CBJ) have introduced a variety of reforms in recent years that favor MSME financing. Though these reforms are enacted, they often fail yet to reach full scale.

Objectives:

As the supply of innovative financial services to MSMEs in Jordan is inadequate, the overall objective of the project is to improve the access to innovative financial services for growth-oriented micro, small and medium-sized enterprises (MSMEs) in Jordan.

To improve the insufficient access to finance for MSMEs, the project has designed the following four outputs:

• Output 1 aims to strengthen the Central Bank of Jordan's capacity to create an enabling environment for innovative MSME financing.
• Output 2 aims to strengthen financial intermediaries about the provision of innovative financial services for MSMEs.
• Output 3 aims to develop and adapt qualification offerings on innovative financial services for growth oriented MSMEs to increase their knowledge and foster the usage of such products.
• Output 4 aims to improve the access to financial services for women-led businesses.

Our project team will work on outputs 2 and 4.

Tasks of the National MSME Finance Expert:

• Design, implementation, monitoring and evaluation of capacity development measures for Jordan partner financial intermediaries in innovative MSME financing.
• Support in the evaluation and on-boarding of potential PFIs and providing reports in this respect.
• Identify or verify needs for advisory and support indicated by PFIs in the field of MSME finance.
• Carry out the MSME finance research activities, the “sectoral deep dives”.
• Provide on-site capacity building to Jordan PFIs on MSME finance with a focus on microfinance banks (product development, MSME finance strategy development, product piloting, internal process refinement, etc.).
• Occasionally, provide trainings or other input for selected other stakeholders in the Jordan financial sector on innovative MSME finance.
• Support the setting-up of the M&E system.
• Ensuring that monitoring procedures are carried out.
• Assist the regular reporting in accordance with deadlines.
• Supporting the GIZ officer responsible for the commission in updating and/or adapting the project strategy, in evaluations and in preparing a follow-on phase