The microfinance market in Sub-Saharan Africa is expected to achieve growth rates of 10-20% in 2015, according to the Microfinance Market Outlook by responsAbility Investments.

The global microfinance market is expected to grow by 15-20% in 2015, whereas the MENA region is expected to grow by 15%.

Christian Etzensperger, Senior Research Analyst at responsAbility Investments, said the experts interviewed for the Outlook were more conservative in their forecasts, adding that SSA growth rates of 10-20% in 2015 are around 10 percentage points below the level defined for 2014.

Nevertheless, he stressed that the countries in Sub-Saharan Africa are continuing their success story.

“In Kenya, Nigeria, Ghana and, to some extent, also in Tanzania, the private sector has developed enormously from a quantitative and qualitative perspective. These countries are today generating strong domestic demand that is largely driven by private consumption,” he said.

With the exception of Ghana, all of the larger economies have succeeded in keeping inflation in single digits, resulting in the stabilization of their currencies.

Financing conditions have also improved: in a notable development in 2014, Kenya and Ivory Coast were able to access the international capital markets by issuing Eurodollar bonds.

According to the IMF, Kenya is likely to grow by over 6% in 2015, while Tanzania and Nigeria may achieve growth of as much as 7%.

At 4.7%, Ghana’s growth rate remains relatively moderate and is therefore significantly below the average for Africa.

He said that in addition to established market participants, less mature microfinance institutions (MFIs) are continuing to offer attractive investment opportunities: “Investments in MFIs that are currently in the process of becoming regulated commercial banks are particularly attractive.”

Etzensperger said that the economic impacts of the Ebola virus in West Africa are still difficult to assess.

“responsAbility does not currently have direct investments in the countries that are affected on a large scale. In view of the urgent demand for capital, it will, however, consider investing there once business returns to normal,” he said.

With regard to the MENA region, Etzensperger said that these countries are continuing their economic recovery despite some political uncertainty.

“The microfinance markets of Tunisia, Morocco and Jordan are likely to grow by around 15%. This encouraging growth rate is mainly attributable to the improved market infrastructure, adequate regulation and the existence of credit bureaus,” he said.

“In the case of the Tunisian market, it is particularly pleasing to note that it is experiencing an upturn four years on from the Jasmine Revolution. This process has been underpinned by the establishment of a series of MFIs,” he added.

Etzensperger said that unlike conventional bonds or bond funds, microfinance investment vehicles are not negatively impacted by a possible rise in interest rates.

“Microfinance investments remain attractive even in a rising interest rate environment, as the investments are valued at cost and have short maturities. These features offer a degree of protection against price losses in the event of a sharp hike in interest rates,” he said.

Founded in 2003, responsAbility currently has $2.4bn of assets under management, which are invested in over 500 companies in more than 90 countries.

As one of the world’s largest microfinance investors, responsAbility has invested or reinvested a total of $882m microfinance companies over the period of 12 months (from the third quarter of 2013 to the third quarter of 2014).