It will also increase access to finance and support intra-Africa trade between Zimbabwe, SADC, and the rest of Africa
THE Board of Directors of the African Development Bank Group (http://www.AfDB.org) on Thursday, November 30, approved a USD 15 million Trade Finance Transaction Guarantee facility for NMB Bank in Zimbabwe.
This is AfDB’s first project with NMB, a registered commercial bank with strong SME credentials. This facility will provide 100% guarantee to international confirming banks (CBs) for the non-payment risk they take on NMB’s trade finance transactions conducted on behalf SMEs and local corporates active in agri-business and trade distribution value chains in Zimbabwe. The trade facility is projected to support more than USD 100 million in total trade volumes by 2026 and by extension reduce the continent’s trade finance gap. It will also increase access to finance and support intra-Africa trade between Zimbabwe, SADC, and the rest of Africa.
AfDB’s Zimbabwe Country Manager Moono Mupotola noted that SMEs and other domestic firms have a harder time accessing trade finance than multinational corporates and large local corporates. “This transaction guarantee facility is therefore a timely and strategic tool that will enhance correspondent banking relationships for NMB and, in the process, help reduce Zimbabwe’s trade finance gap,” she said.
“This trade intervention speaks to the AfDB’s trade finance program objectives to support SMEs, women-owned businesses, farmers, and local enterprises/local corporates on the continent by connecting them into key value chains regionally and globally,” said Lamin Drammeh, AfDB’s Head of Trade Finance.
December 7, 2023 @ 6:01 GMT|Tags: Lamin Drammeh