The African Guarantee Fund (AGF) and United Bank for Africa (UBA) have forged a strategic partnership aimed at providing $100 million in fresh loans to Small and Medium Enterprises (SMEs) and business owners across the 20 African countries where UBA operates.

Under this partnership, AGF will extend support and guarantees to SMEs through a $50 million Portfolio Guarantee, alongside facilitating extensive capacity development for UBA’s SME customers, with a particular focus on women-led businesses and green finance projects.

During the signing ceremony at the UBA Head Office in Lagos on Monday, Group Managing Director of UBA, Oliver Alawuba, highlighted the bank’s commitment to supporting SMEs, especially those led by women, leveraging its expansive network across Africa and major global financial hubs.

Alawuba expressed enthusiasm about the partnership’s potential to catalyze UBA’s intervention for SMEs and green initiatives, driving innovation and sustainable growth. He also reiterated UBA’s dedication to advancing the African Continental Free Trade Area (AfCFTA) initiative, demonstrating a $6 billion commitment to SMEs across Africa.

Additionally, Alawuba emphasized UBA’s collaboration with the Affirmative Finance Action for Women (AFAWA) protocol, which aims to provide loans to women-owned SMEs at concessional rates and with customer-friendly collateral terms, addressing the significant financing gap faced by women in Africa.

The partnership will extend capacity development initiatives at no cost or at highly discounted rates, while engaging with African governments to foster a more conducive business environment for women. It will also enhance UBA’s Green Finance offerings across the continent.

In his remarks, the Group CEO of African Guarantee Fund, Jules Ngankam, underscored the significance of the collaboration between two pan-African institutions in driving economic growth by de-risking SMEs, particularly those led by women and operating in the green sector.

This partnership builds upon UBA’s commitment to driving its $6 billion initiative for SMEs under the AfCFTA, marking a significant step towards empowering SMEs and promoting economic development across Africa.

UBA, one of the largest employers in the African financial sector, operates in 20 African countries and several global financial centers, serving over 35 million customers worldwide.

The African Guarantee Fund (AGF) specializes in guarantee products and capacity development assistance to increase SME financing across key economic sectors in Africa. Since inception, AGF has unlocked over USD 3.5 billion in SME financing across 40 African countries.

AFAWA, an initiative of the African Development Bank Group, aims to close the $42 billion financing gap for women in Africa by providing comprehensive support to women-owned and women-led SMEs. Through AFAWA, the African Development Bank has approved $1.5 billion of investment for women entrepreneurs in 32 countries, channelled through 96 financial institutions.

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