Ecobank Group and the African Guarantee Fund (AGF) have signed a $200 million risk-sharing agreement to drive economic growth and support entrepreneurship, with a focus on women-owned SMEs throughout the continent.
The strategic partnership agreement was inked at the Africa Financial Industry Summit (AFIS) in Lomé, Togo, marking the third renewal of Ecobank’s collaboration with AGF.
Launched in 2013 with a $50 million guarantee for seven countries, the agreement has evolved. By 2018, it covered 14 countries, with a cumulative disbursement of $230 million. The renewed partnership now spans 27 countries in Ecobank’s African network, providing 50 percent coverage for eligible SMEs across targeted markets.
“This enhanced partnership with the African Guarantee Fund marks a significant step forward in our commitment to supporting SMEs across Africa with affordable financing,” stated Jeremy Awori, Ecobank Group CEO. “Through this partnership, we aim to eliminate the rigorous and restrictive requirements for collateral particularly hindering women-focused businesses’ access to credit.”
Jules Ngankam, African Guarantee Fund Group CEO, emphasised the transformative impact of the partnership on SMEs, highlighting: “The renewal of our partnership with Ecobank Group to now span 27 countries is proves the importance of risk-sharing mechanisms banks should leverage to grow their SME portfolios. This partnership will catalyse close to US$1billion of financing for SMEs, who are the real drivers of growth in African economies”.
“The US$200million facility allows Ecobank to significantly boost its lending capacity to SMEs, enabling the bank to extend more credit facilities to SMEs seeking to expand, innovate and contribute to job creation,” added Awori.
The risk-sharing agreement is poised to have a ripple-effect across sectors, contributing to increased economic activity, job creation and sustainable development across sub-Saharan Africa. It covers 27 countries: including Benin, Burkina Faso, Burundi, Cameroon, Cape Verde, Central African Republic, Chad, Congo, Côte d’Ivoire, Democratic Republic of Congo, Equatorial Guinea, Gabon, Ghana, Guinea Bissau, Guinea Conakry, Kenya, Mozambique, Nigeria, Rwanda, Senegal, Sierra Leone, South Sudan, Tanzania, Togo, Uganda, Zambia and Zimbabwe.
AGF, a specialized guarantee provider, is dedicated to fostering economic development and reducing poverty in Africa by enhancing access to finance for Small and Medium-sized Enterprises (SMEs) across vital economic sectors. Since its establishment, AGF has facilitated over $3.5 billion in SME financing through collaborations with 200 financial institutions across 40 African countries.