MSME Credit Risk Management Technical Assistance (TA) for MESMER Partner Financial Institutions

ABOUT FC Africa

Founded in Ethiopia and operating across the continent, FC Africa is a pan-African organization delivering complex economic development programs at scale. Established in 2006, FC Africa has grown into a trusted partner for governments, development partners, financial institutions, and private sector actors, known for execution discipline, institutional credibility, and results that endure. Our multidisciplinary teams combine a capacity to execute with clarity of the local context. As a result, we have delivered at-scale real impact in terms of job creation, business formation, business growth, and investment attraction and mobilization.

MESMER PROGRAMME

Micro, Small, and Medium Enterprise Recovery and Resilience Program (MESMER) is a 5-year program launched in October 2022 to support 72,200 MSMEs and 410,800 jobs by creating access to finance for micro, small and medium enterprises (MSME) to realize their growth prospects and resilience. MESMER will also work to provide support to MSMEs through business development support, psychosocial services, and technical assistance to financial institutions.

BACKGROUND OF THE ASSIGNMENT

The growth and development of Ethiopian MSMEs, as well as their contribution to the country’s socioeconomic development, are constrained by multiple challenges. These include limited access to finance, weak technical and business leadership skills, lack of adequate working premises, underdeveloped support systems and market linkages, and high exposure to shocks such as conflict, inflation, and broader macroeconomic pressures. Among these constraints, access to finance is most frequently cited by MSMEs. This is largely due to commercial banks’ business models, which primarily serve large enterprises with fixed asset collateral and therefore offer few MSME targeted financial products and services. In addition, banks are often reluctant to engage with MSMEs due to perceived high risk and relatively low returns. Microfinance institutions, while playing an important role, have traditionally focused on micro-enterprises and group lending and often face technical capacity and funding limitations that restrict their ability to provide tailored financial services to MSMEs. As a result, many Ethiopian SMEs fall within the “missing middle” in terms of access to finance. In response, the MESMER programme seeks to promote inclusive and innovative financial services for MSMEs and to support partner banks in developing financial products that better address the specific financing needs of this segment.

ASSIGNMENT OBJECTIVE

The overall objective of this assignment is to strengthen the MSME credit risk management systems and practices of MESMER partner financial institutions (4 banks and 8 MFIs), with the aim of maintaining a healthy and sustainable MSME portfolio. The assignment will introduce best-practice frameworks, systems, and tools, and will provide targeted training and mentoring to relevant staff.

Specific Objectives

To conduct a comprehensive gap analysis and develop actionable recommendations;
To develop and/or update MSME credit risk management guidelines, tools, and templates;
To train and mentor financial institution staff to enhance their capacity in MSME credit risk management in line with best practices.

SCOPE OF WORK

The service provider will carry out the following key activities with the guidance of the program management:

Financial sector performance and potential risks review and strategic insights:
- Review and analyze risk management program and practices of the banking industry, financial sector landscape, trends, business environment, policy changes and global dynamics, with the emphasis on prospectus and potential risks,
- Provide guidance and insights on financial sector risks and MSME finance market dynamics as well as mitigation strategies to further enhance access to finance for MSMEs and other disadvantaged groups.
Diagnostic review & gap assessment:
- Conduct entry meeting and structured key informant interviews with HO risk management divisions, credit operations division, district managers, and branch credit team.
- Review existing MESMER/MSME credit policies or MSME lending guidelines, credit risk management program/policy, system and practices of each partner FI.
- Review existing portfolio quality strategies and credit risk appetite frameworks.
- Assess current loan appraisal workflows for MESMER-supported MSME loans.
- Review loan monitoring, early warning, and follow-up practices.
- Analyze loan recovery and remedial management procedures.
- Assess sample branch-level practices for underwriting, follow ups and delinquency management of the partnering FIs.
- Review MESMER NPLs cases at sample branches and identify root causes, and draw actionable recommendations.
- Prepare a consolidated diagnostic report comprising existing gaps and areas of improvement for each bank.
- Organize validation meeting with the FI’s management team and present identified gaps and actionable recommendations,
Support FIs in Strengthening MSME credit risk management:
- Produce/update MSME credit underwriting procedure and policy document,
- Produce/update MESMER NPLs Management guideline/MSME credit risk management guideline and tools following best practices and principles,
- Produce tailored and enhanced MSME credit risk management tools, checklist and templates
- Produce/Improve credit risk database/register, scoring tools and other relevant supporting tools to enhance MESMER loan portfolio quality.
- Design improved loan monitoring templates and reporting formats.
- Refine loan restructuring and rescheduling guidelines.
Organize trainings and coaching sessions for partner FIs staff,
- Produce MSME credit risk/NPLs management training materials/modules- handout, PPT, case studies, role play and others,
- Organize class trainings and onsite coaching sessions focusing on MSME credit risk/NPLs management for FIs staff at HQ, districts and branches,
- Organize TOT for HO SME and risk departments team
Provide ongoing support to partner FIs as required
- Provide ongoing guidance and technical advice for MESMER Management and partner FIs in areas of MSME credit risk management,
- Any other related activities assigned by the programme TA Lead.
Reporting
- Provide biweekly and monthly progress reports in respective TA activities,
- activities,

DELIVERABLES AND TIMEFRAMES

Expected deliverables of the assignment and timeline are listed in the table below.

#	Deliverables	Timeline/frequency
1	Inception report with detailed work plan and methodology	Mar 13, 2026
2	Financial sector insights and business environment update focusing on potential risks and prospects (very brief updates at least on a monthly basis)	At the end of each month
3	Assessment/diagnostic report for each bank	Mar 31, 2026
4	Updated/enhanced MSME credit underwriting procedure and policy document	April 15, 2026
5	Enhanced and customized MSME credit risk management tools, templates and checklists	April 30, 2026
6	Enhanced MESMER NPLs management guideline and training modules,	April 30, 2026
7	Organized combined training for FIs staff and delivery report- MESMER NPLs/MSME credit risk management and MSME financing	At least 4 trainings
8	Organized ToT and delivery report	At least two ToT
9	Follow up and onsite coaching reports	Ongoing and frequent /month
10	TA activity/progress report	End of each month
11	Final TA report	June 30, 2026

Based on the agreed training schedule and timing, FC Africa will cover the training and workshop related costs.

Expected deliverables of the assignment and timeline are listed in the table below.

Based on the agreed training schedule and timing, FC Africa will cover the training and workshop related costs

REQUIRED QUALIFICATIONS

Service provider must demonstrate the following qualifications.

A minimum of 8 years of proven experience in financial sector, credit risk management and more specifically in MSME credit risk management and provision of TA for banks and other FIs,
Hands on experience in MSME finance procedure and practices as well as designing MSME credit risk management tools and templates,
Good knowledge of the Ethiopian financial sector risk management system and practices including regulatory frameworks,
Experience in conducting a diagnostic and devise practical recommendations for FIs in areas of risk management and MSME financing,
Good knowledge of the risk management and SME finance market in Ethiopia,
Proven experience in training design, delivery and mentoring programs for financial institutions,
Excellent analytical, reporting and interpersonal skills and ability to work with others,
Ability to work with public and private sector stakeholders.

WORKING ARRANGEMENT AND REPORTING

The service provider will be working under a contract with FC Africa Group PLC. The service provider will report directly to the MESMER Deputy lead, and credit & grant team.
The service provider is obligated to adhere to all required deadlines and maintain availability according to a schedule, which maybe adjusted at any time as deemed necessary.

TECHNICAL AND FINANCIAL PROPOSAL

Interested applicants are required to submit:

Technical Proposal, including:
- Understanding of the assignment and proposed methodology
- Detailed implementation plan and timeline
- Organizational profile and relevant experience
- Team composition and key personnel CVs
- Copies of renewed business registration documents
Financial Proposal, including:
- Detailed cost breakdown by activity, region, and deliverable
- · All costs are inclusive of taxes, logistics, personnel, and operational expenses
- All pricing must be submitted in Ethiopian Birr (ETB) only.

EVALUATION CRITERIA

#	Description	Weight
1	Technical Competency	75%
1.1	Understanding of the assignment	20%
1.2	Relevant organizational experience and past performance	20%
1.3	Team composition, qualifications, relevant experience and implementation capacity	35%
2	Financial feasibility / budget	25%

Candidates who scored below 50% on the technical evaluation will not be considered for financial evaluation.

APPLICATION PROCESS

Applicants should email their technical and financial proposals separately to bids2@firstconsultet.com with the relevant information detailed in the technical and financial sections of the proposal.

The subject of the email should be stated as “MSME Credit Risk Management Technical Assistance (TA) for MESMER Partner FIs.” Proposals sent after this date will not be considered.

Proposals must be received on or before Feb 20, 2026, until 5:00PM (GMT+3:00).

INFORMATION

For the scheduled information session, please use the link provided below to join.

Topic: Info Session – MSME Credit Risk Management Technical Assistance (TA)

Time: February 17, 2026, 10:30 Nairobi

Zoom Meeting Link: here

Meeting ID: 870 1373 1788

Passcode: igwTb0

For clarification or for any queries relating to this assignment, please contact the focal person below on or before February 17, 2026, until 5:00 PM (GMT+3:00):

Name: Kalkidan Gezahegn

Title: Manager, Credit and Grant Component, MESMER Email address: kgezahegn@fcafrica.com

N.B: FC Africa reserves the right to reject the bid fully or partially.