Nigeria: UBA introduces $6 billion initiative for African SMEs

United Bank of Africa (UBA) has launched a $6 billion financing initiative with the goal of promoting Small and Medium Enterprises (SMEs) across the African continent.

This initiative is designed to provide funding access to SMEs in the Agro-processing, Pharmaceuticals, Automotive, Transport, and Logistics sectors, facilitating their expansion.

UBA has partnered with the African Continental Free Trade Area (AfCFTA) secretariat to launch the financing initiative.

By the agreement, UBA and AfCFTA will, under the first phase of the partnership, promote the development of SMEs by providing technical and financing solutions for intra-African/domestic alternatives.

The Deputy Managing Director of UBA, Muyiwa Akinyemi represented the bank during the signing of the agreement. He emphasized UBA’s commitment to supporting the growth and development of SMEs across the African continent, aligning with the bank’s strategic focus on this sector as a catalyst for economic advancement in Africa.

“We shall also be leveraging technology to deliver our financing activities to the beneficiaries and this platform provides us with a unique opportunity to stimulate the development of the continent as Africa’s Global Bank,” he said.

In addition, Alero Ladipo, UBA’s Group Head of Marketing and Corporate Communications, underscored the bank’s commitment to offering $240,000 in financing.

This support will be extended through a mix of working capital loans and asset finance loans, with the ultimate goal of positioning these enterprises for success in Africa’s evolving business landscape.

UBA, a dominant player in Nigeria’s financial services sector, boasts an extensive footprint that spans 24 countries across four continents, including the United Kingdom, the United States, France, and the United Arab Emirates. The bank holds a pivotal position in the African financial landscape.

She explained that the SMEs in the four chosen sectors will be able to access a working capital loan by way of overdrafts and short-term loans with a maximum value of $120,000 in each of their country’s local currency; and asset finance loan of up to $120,000 in the local currency of the obligor, to use for the acquisition of operational assets and equipment to meet their business expansion needs.

Tony Elumelu, who possesses a 7.39-percent stake in UBA, corresponding to 2,527,372,285 common shares, is not only recognized as one of the most affluent investors on the Nigerian Exchange but also ranks as one of Nigeria’s richest men. He is notably one of the country’s most successful.

Under Elumelu’s leadership, UBA achieved remarkable financial performance in the first half of 2023. The bank announced an extraordinary 437.8-percent increase in profits, skyrocketing from N70.34 billion ($94.7 million) in the first half of 2022 to an impressive N378.23 billion ($512.4 million) during the same period in 2023.

Source: africa.businessinsider.com