The African Guarantee Fund (AGF) and United Bank for Africa (UBA), yesterday, signed a partnership to enable UBA to provide $100 million in new loans to small and medium enterprises (SMEs) and business owners across the 20 African countries where the bank has a presence.
The AGF under this agreement will support and guarantee SMEs with $50 million portfolio guarantee as well as facilitate extensive capacity development for the bank’s teeming customers who run small businesses across the continent, paying special attention to women-led businesses and green finance projects.
UBA’s Group Managing Director, Oliver Alawuba, who spoke during the partnership signing ceremony at UBA Head Office in Lagos, said as Africa’s Global Bank, UBA remains committed to supporting SMEs in Africa, especially to women-founded and managed businesses, given its robust network, which is spread across the 20 countries in Africa and major global financial capitals.
“This guarantee will catalyze the bank’s intervention for SME business, women-led and environment-friendly businesses, enabling us to further extend our reach and impact. Additionally, the extensive capacity development initiatives planned for our SME customers across 20 African countries align with our vision to empower businesses, drive innovation, and foster sustainable growth.
“I am particularly excited about our focus on advancing the Africa Continental Free Trade Area (AfCFTA) initiative, reaffirming UBA’s $6 billion commitment to SMEs across Africa. This initiative, announced in September last year, demonstrates our dedication to supporting the economic integration of our continent,” he said.
Group CEO of African Guarantee Fund, Jules Ngankam, said the partnership would significantly drive economic growth across the continent.
“SMEs despite being the backbone of all African economies accounting for 90 per cent of the private sector and 60 per cent of all jobs are perceived as risky and therefore have limited access to financing. Through this guarantee facility and the technical capacity development grant support, we will de-risk SMEs with a priority on those that are owned or led by women and those that are within the green sector,” he said.
This partnership is a sequel to the announcement made by UBA and AfCFTA Secretariat, which will help the bank drive its $6 billion commitment to SMEs across Africa under the AfCFTA initiative.
