A country head preparing an annual review on Central Africa almost always presents the same diagnosis: the pipeline is insufficient. That diagnosis is wrong, and it is expensive, because it points to the wrong response — more prospecting, more missions, more events.
The pipeline is not insufficient in volume. It is insufficient in state. The files exist, they are numerous, and they all die in the same place.
Where they die, and the statistic that says so
Asked why they do not lend more to small and medium-sized enterprises, African banks cite first the lack of bankable projects, at 40 %, ahead of insufficient collateral, at 37 %.
These two figures are usually read as two symptoms of the same illness. They are two problems of different natures, and only one of them is addressed by a financial instrument.
Insufficient collateral can be addressed: that is what a portfolio guarantee, a first-loss facility or a credit enhancement does. Those tools exist, they work, and the industry has mastered them.
The lack of bankable projects is addressed by no instrument, because it is not a risk problem — it is a document problem.
And it has a measurable root: in the CEMAC zone, four companies out of five operate outside official records, without certified accounts or auditable financial statements.
What "not bankable" precisely means
The word misleads because it sounds like an economic judgement. It is not one.
A Cameroonian mid-sized company may have been profitable for ten years, serve a real market, hold a solid order book and tangible assets — and remain strictly unassessable for an investment committee. Not because it is fragile, but because there exists no set of documents from which its repayment capacity can be established by a defensible method.
Concretely, what is missing is almost never ambition or market. It is this:
- accounts restated to an identified framework, with the gap to published accounts made explicit;
- a clear ownership chain — who holds what, under which instrument, registered where;
- security validly constituted, registered, and still enforceable at the date of the file;
- a cash plan linking the financing need to the real operating cycle, not to a desired amount;
- an additionality note and environmental and social framing in the expected format.
None of these is produced by a financing institution. All must exist before the first investment officer opens the file.
The cost nobody measures
A file that dies in committee did not cost only the committee's time.
It consumed several months of investment-officer time, missions, a legal review, often an environmental pre-appraisal, sometimes external counsel. Sector literature commonly refers to direct origination cycles of eighteen months for files that do not complete — and that cost is charged to no project, since there is no project.
It is this invisible cost that explains a rational and rarely acknowledged behaviour: with a fixed analysis budget, an institution first appraises the files it knows it can appraise, that is, the largest and best documented. The mid-market segment — the one every mandate talks about — is the first to be set aside, not by strategic choice but by workload arithmetic.
What changed since April, and worsens the calculation
Two recent developments tighten the constraint further, and they must be understood to see why the intermediated channel will not compensate.
On 2 April 2026, the BEAC's Monetary Policy Committee suspended refinancing operations for medium-term credit intended to support productive investment. The Governor confirmed on 29 June that the suspension answered a request from the International Monetary Fund, whose position is that the mechanism should be phased out. Banks in the zone therefore lose one of the few arrangements allowing them to match medium-term lending with a corresponding resource.
Separately, COBAC regulation R-2025/02, in force since 1 January 2026, raises the minimum share capital of banks from 10 to 25 billion francs, with a first step at 14 billion on 31 December 2026. An institution absorbed by its own recapitalisation does not reallocate analytical resource to an expensive segment.
In short: at the precise moment partner banks are expected to absorb more files, they have less long resource and more capital constraint.
What origination that holds looks like
Origination that produces assessable files shares four characteristics, and none is financial.
It is local and permanent. Bringing a file into shape is done in the country's language and law, in the company's own archives, with its auditors and its counsel. It is done neither on mission, nor remotely, nor by form.
It is sequential, not simultaneous. A file is built in an order: ownership and security first, then accounts, then and only then the financing plan. Inverting that order — starting with the financial structure — produces elegant files backed by poorly held assets, which die at legal due diligence.
It eliminates early. Useful origination discards fast. The value of a screen is not in the files it sends up, but in the months it saves from being spent on those that never will. An honest pipeline is a short pipeline.
It produces a format, not an opinion. The deliverable is not an investment recommendation — it is a file in the format the committee expects, with verifiable documents and stated gaps. The institution keeps its judgement entire; it simply no longer has to reconstruct the facts.
The question to ask before adding resources
Before increasing prospecting, one measure clarifies the diagnosis:
Over the last twenty-four months, among files that entered appraisal and did not complete, what proportion was set aside on risk grounds — and what proportion because the file was incomplete or unverifiable?
If the second category dominates, adding prospecting amounts to increasing flow into a pipe blocked at the other end. The problem is not finding projects: it is making them legible.
And bringing them into shape, unlike risk, requires no new instrument, no additional funds and no mandate revision.
Published 14 August 2026. The regulatory facts cited are verified as at that date.
