“When it floods in front of my shop, customers don’t show up.” – Justine, Trader, Ghana
By Grégoire Danel Fedou, Deputy CEO, Advans International
Although Africa has contributed only 7% of global carbon emissions since the 19th century, it remains the most vulnerable region to the adverse effects of climate change. The International Rescue Committee (IRC) estimates that seven of the ten countries at the highest risk are in Africa, including Somalia, Chad, South Sudan, the Democratic Republic of Congo, and Nigeria. The impacts of climate change pose a significant threat to the region’s progress toward achieving the United Nations Sustainable Development Goals (SDGs). Rising temperatures, droughts, and flash floods have triggered food insecurity and widened economic inequality, pushing many communities further into poverty.
The situation is especially tough for micro and small businesses and farmers across the continent. Given the increasing risks to African populations, Advans, a leading microfinance group operating in Africa, has developed a climate strategy to support its MSME and farmer clients in building their capacity for adaptation and resilience. This strategy includes both financial and non-financial solutions to help them recover from shocks and prepare for the future. Advans is currently piloting this strategy in Côte d’Ivoire, Ghana, and Tunisia, with plans to expand to other subsidiaries in the coming years.
In Ghana, the effects of climate change have been particularly severe. The country has faced over 27 major floods in the past 30 years, with 15 of those affecting Accra, the capital. Reports indicate that seven out of ten Ghanaians lack access to insurance, while 42% of the population remains excluded from basic financial services—leaving many without a safety net to recover from climate shocks.
In Tunisia, Advans’ studies and client interviews show that water scarcity is the most serious climate-related risk for farmers in the cereal, market gardening, and livestock sectors. Meanwhile, in Côte d’Ivoire, climate change has heavily impacted the cocoa sector, as reduced rainfall, rising temperatures, and shifting seasons have negatively affected yields. Advans estimates that 22% of clients in its portfolio across the three pilot markets are vulnerable or highly vulnerable to climate risks.
To address this, Advans aims to integrate climate risk management directly into its operations and overall strategy. This approach begins with a comprehensive understanding of how climate risks affect the geographies and sectors it serves, followed by developing financial products that help clients adapt and recover while raising awareness about climate challenges.
Advans’ climate strategy is built around four key pillars:
1. Raising awareness among teams
Advans places strong emphasis on educating its management and staff—especially those who interact directly with clients—on the causes and effects of climate change. This enables them to act as ambassadors in the field. Over 700 staff members across the group have already participated in the Climate Fresk workshop, and the organization is rolling out online and classroom modules on climate risks and client awareness for field staff.
2. Evaluating the impact of climate change on its portfolio
Advans conducts risk analysis to assess:
i) which climate hazards are most likely to affect the areas where clients operate, and
ii) how vulnerable each sector and client is to those hazards.
The results are combined to determine a physical risk score, enabling Advans to map climate risks across its portfolio. For instance, a study conducted with Horus Development Finance found that around 25% of borrowers in Ghana are currently at significant or very high risk of flash floods.
3. Building the resilience of vulnerable clients through awareness and education programs
Advans supports clients facing flooding, droughts, or fires by implementing targeted awareness and educational initiatives. In Ghana, the organization has raised awareness about flood mitigation methods by distributing flyers and sending mobile and social media alerts at the start of the rainy season—reaching nearly 20,000 users. Advans also plans to launch climate adaptation training programs for farmers in Côte d’Ivoire and Tunisia to strengthen long-term resilience.
4. Adapting products and services to strengthen long-term resilience
To help entrepreneurs manage emergencies and prepare for the future, Advans is integrating climate considerations into product design. Many clients already report improved preparedness: a 2024 study by 60 Decibels found that 59% of farmers in Tunisia felt better equipped to face climate shocks thanks to Advans loans.
In Côte d’Ivoire, Advans has piloted an index and yield insurance to protect cocoa farmers against extreme climate shocks, with over 2,300 farmers covered between 2024 and 2025. In Ghana, Advans is testing a new insurance and loan package that helps clients restart their businesses after extreme weather events. The package includes coverage for losses, a grace period, preferential interest rates, and flexible repayment terms for loyal clients with good repayment records.
In today’s rapidly evolving African economy, adaptability is essential for success. Supporting small businesses and entrepreneurs to recover from climate-related crises is critical to building resilient economies. Organizations like Advans are demonstrating that financial inclusion can drive meaningful and sustainable change across Africa.
The roadmap is clear: it is time to harness the power of microfinance to equip African businesses with the resilience they need to sustain their operations and continue growing in the face of climate challenges.
Ten countries at highest risk of climate disaster: Somalia, Syria, DRC, Afghanistan, Yemen, Chad, South Sudan, Central African Republic, Nigeria, and Ethiopia.
Sources:
- Advans International – Climate Change & Resilience of Tunisian Farmers
- 60 Decibels, a global leader in social impact customer insights, with over 1,400 researchers across 80+ countries.
