KfW Development Bank, a German bank, is set to empower 10,000 Small and Medium-sized Enterprises (SMEs) with $33 million credit facility.
The German bank designed the initiative to support the African Guarantee Fund (AGF) realise its goal of providing financial guarantees to African entrepreneurs.
This was announced by AGF’s Group Chief Executive Officer (CEO) Felix Bikpo. According to Bikpo, the bank’s funding would enable the group to carry out its initiatives in Africa.
He said that this new injection came at a time the continent’s SME sector had been singled out as a key driver of growth.
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Bikpo made known that the group would also be partnering financial institutions so as to create 30,000 jobs on a yearly basis.
“We are excited about the confidence our shareholders and partners have in what we are doing in Africa. This capital injection will go a long way in ensuring that we continue to make a positive impact on the continent.
“So far, we have cumulatively issued more than $1 billion worth of guarantees, making available about $1.7 billion for SME financing through our partner financial institutions. This has led to the creation of more than 100, 000 additional jobs,” Bikpo said.
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Why this matters: This funding would enable African SMEs to continue to play their critical role in driving Africa’s economy as the AGF platform aims to create easy access to financing for SMEs across the continent.
Speaking further, The Nation reported that Bikpo described the milestones reached by the organization. He disclosed that 20,000 African SMEs had benefitted from the AGF Guarantees, 60% of who are young people across Africa.
He also said 30% of the SMEs are owned by women, adding that youths and women are demographics that heavily impact Africa’s economy.
About AGF: The AGF was founded by the government of Denmark through the Danish International Development Agency (DANIDA); the government of Spain through the Spanish Agency for International Cooperation and Development (AECID) and the AfDB. Other shareholders include French Development Agency (AFD), Nordic Development Fund (NDF), Investment Fund for Developing Countries (IFU) and KfW.