African Development Bank and Standard Bank Unite to Support SMMEs and Boost Trade

The African Development Bank Group (AfDB) and Standard Bank Group (SBG) signed a landmark financial agreement to enable funding for small, medium, and micro enterprises (SMMEs) and expand trade across Africa as well.

This agreement was officially formalized through a $196.2 million and a $200 million Risk Participation Agreement (RPA) targeting up to 4000 small, medium and micro enterprises (SMMEs). This initiative will strengthen Standard Bank’s lending capacity.

This social bond investment, manage by the Standard Bank of South Africa (SBSA) is particularly designed to unlock credit for SMMEs with a turnover below R300 million loan sizes and R40 million to enable them scale operations, create jobs and contribute to the economic resilance in South Africa.

Again, the social bond formalized through a $200 million Risk Participation Agreement (RPA) will enhance trade across Africa, aiming at low income countries and transition states. It will also allow local banks to increase lending by sharing risks, linking the gap of financial trade and promoting intra- Africa trade.

“This partnership will strengthen our ability to support numerous small, medium and micro enterprises (SMMEs) because that is the backbone of South Africa’s economy. As we are providing much needed capital, we are helping enterprises to overcome financial challenges” as the Deputy Chief Executive Officer of Standard Bank Group, Kenny Fihla expressed.

Leila Mokaddem, Director General for South Africa said that “This kind of collaboration marks an achievement in our long term partnership and is a testament to our shared responsibility to support small, medium and micro enterprises (SMMEs) growth. The increasing financial addition and trade opportunity supports businesses to drive economic reform and regional integration. The Standard Bank Group continues to be a strategic partner in our shared vision for the development of the the economy on the continent”.

Ahmed Attout the African Development Bank’s Financial Sector Development Director stated that “This is not a short term fix but we are also creating frameworks for lasting growth, from the agro processing firms in Zambia to tech startups in Nigeria”.

This kind of initiative relate with the Ten Year strategy (2024-2033) of the African Development Bank, which prioritize industrialization, regional integration and improving the standard quality of life living in Africa.