African Development Bank bails out Afreximbank with $500,000 grant
The African Export-Import Bank (Afreximbank) has entered into an agreement under which the African Development Bank to provide it with a $500,000 grant from its African Private Sector Assistance (FAPA) programme to be used in supporting emerging factoring firms in Africa.
The Agreement, signed at the Afreximbank Annual Meetings and 25th Anniversary Celebrations in Abuja on 13 July, is aimed at upgrading the capacity and skill-sets of up to 20 emerging factoring firms and providing advisory services to enhance the sustainability of established growth-orientated factoring firms, regulators, financial institutions and business and trade associations in Africa.
Kanayo Awani, Managing Director, Intra-African Trade, signed on behalf of Afreximbank while Ebrima FAAL, Senior Director, Nigeria Country Office, signed for the African Development Bank, in the presence of Elfriede Geisler, Chargé d’Affaires, Embassy of Austria in Nigeria, and Yutaka Kikuta, Ambassador of Japan to Nigeria, who represented the FAPA donor countries.
Commenting on the agreement, Dr. Benedict Oramah, President of Afreximbank, said: “SMEs in Africa have long faced real difficulties accessing external finance for their business activities and this has impeded their growth and prevented them pursuing commercial opportunities. Afreximbank sees factoring as a solution to bridge the funding gap facing SMEs, and the agreement will support our strategy to grow intra-African trade and facilitate greater SME contribution to regional and global supply chains.”
“We are championing the development of factoring in Africa, and our support focusses on the provision of credit lines to factors, capacity-building workshops, policy and regulatory inputs, advisory services and technical assistance to promote best practices. This Agreement with the ADB, and the Grant from FAPA, will reinforce and grow the availability of effective factoring across the continent and increase awareness of its availability.”
The grant will finance:
Capacity building tailored to address needs, including on-site training, provision of back-office support systems and customised manuals for marketing, credit and risk policy, finance and operations, addition to advisory services to established factoring companies and a platform to enable African factoring companies to network, exchange ideas and share best practices.
Development of a sustainable knowledge and learning platform, including e-learning, workshops and the Certificate of Finance in International Trade which provides four weeks’ formal training in factoring under a programme developed by the University of Malta; and
Provision of project management coordination to ensure timely project implementation.