Includes special features of this country’s banking system and rules/laws that might impact U.S. business.
Last Published: 2/28/2017
Madagascar has relatively rudimentary financial markets and a very low rate of bank penetration.  High interest rates, stringent requirements for collateral and guarantees, limited competition among banks, and reluctance to finance foreign trade or working capital even when secured by letters of credit make financing very expensive and difficult to access.  The difficulty of increasing working capital through bank borrowing is a severe constraint on local firms’ ability to expand.  Banks maintain that many prospective borrowers lack reliable and transparent balance sheets and that long-term financing is difficult because they lack a long-term deposit policy. 
 
Only well-known and significant operators can get credit in Madagascar.  The credit granted is mainly for the purchase of traditional agricultural products such as vanilla, coffee, and cloves.  In case of pre-financing by foreign importers, local exporters still have to pay high interest rates to their banks.  Generally speaking, the financing possibilities that are available to local firms are quite limited.
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Madagascar Market Access Banks