Today saw the official signing ceremony for a co-operation agreement between Ecobank Transnational Incorporated ("Ecobank"), the leading pan-African banking group, and the African Guarantee Fund ("AGF") to promote and support small business across Sub-Saharan Africa. Under the terms of this USD 50 million agreement, the two institutions will work together to unlock the potential of small and medium-sized enterprises ("SMEs") in Benin, Burkina Faso, Cameroon, Côte d'Ivoire, the DRC, Kenya and Nigeria to deliver inclusive growth.
The inaccessibility of finance is a major obstacle to small business growth and development, with only 20% of African SMEs receiving a credit line from a financial institution. This agreement aims to assist viable SMEs by providing an AGF-backed partial guarantee for 50% of net losses of principal under the loan facilities extended to customers in the value chain of SME financing programs, including Contract & Receivables Finance, Distributorship Finance and Asset Finance.
Commenting on this transaction, Ecobank Group Chief Executive Officer, Thierry Tanoh said: "This agreement reaffirms Ecobank‟s commitment to support small and medium-sized businesses and our collaboration with Africa Guarantee Fund will further enable the SME sector play a critical role in the socio-economic development of Africa."
Also commenting at the signing ceremony, the Group Executive Director, Domestic Bank, Patrick Akinwuntan said, "Ecobank recognizes that the SME and Medium sized enterprises sector has significant growth potential, represents Africa‟s „rising middle‟ and provides the largest employment pool for our vibrant population. This agreement leverages our unrivalled pan-African footprint to deepen financial inclusion in Africa."
Also speaking, M. Felix Bikpo, the Chief Executive Officer of AGF added: "The partnership with Ecobank is of great significance as it provides the Africa Guarantee Fund with a very important Pan-African Banking network through which African Small and Medium Sized Enterprises (SMEs) will be assisted in getting increased access to financing. This Partnership is another manifestation of AGF‟s role as the missing link to increasing the financing of African SMEs by banks and non-bank financial institutions".
About Ecobank
Incorporated in Lomé, Togo, Ecobank Transnational Incorporated is the parent company of the leading independent pan-African banking group. It currently has a presence in 34 African countries, namely: Angola, Benin, Burkina Faso, Burundi, Cameroon, Cape Verde, Central African Republic, Chad, Congo (Brazzaville), Congo (Democratic Republic), Côte d'Ivoire, Gabon, Gambia, Ghana, Guinea, Guinea-Bissau, Kenya, Liberia, Malawi, Mali, Niger, Nigeria, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, South Africa, South Sudan, Tanzania, Togo, Uganda, Zambia, Zimbabwe.The Group is also represented in France through its affiliate EBI S.A. in Paris. ETI also has representative offices in Dubai, United Arab Emirates and London, UK. ETI is listed on the stock exchanges in Lagos, Accra and the West African Economic and Monetary Union (UEMOA) – the BRVM in Abidjan. The Group has more than 600,000 local and international institutional and individual shareholders. The Group has close to 19,000 employees from 40 countries and 1,206 branches and offices. Ecobank is a full-service bank providing wholesale, retail, investment and transaction banking services and products to governments, financial institutions, multinationals, international organizations, medium, small and micro businesses and individuals. Additional information may be found at www.ecobank.com.
About African Guarantee Fund (AGF)
Officially launched on 1st June 2012, AGF is a pan-African non-banking financial institution, owned by the African Development Bank ("AfDB"), the Danish International Development Agency ("Danida") and Spanish Agency for International Development Cooperation ("aecid").
AGF's primary mandate is to assist financial institutions (banks, private equity funds, lease finance houses and development finance institutions) to scale up their SME financing in Africa via the provision of partial loan guarantees and capacity development assistance. AGF assists financial institutions with the following products: Equity Financing Guarantees; Loan Guarantees (both Portfolio and individual loan guarantees); Resource Mobilization Guarantees; Counter-Guarantees; and SME Financing Capacity Development Assistance. Additional information may be found at www.africanguaranteefund.com.
