The African Development Bank has approved a 20 million dollar Trade Finance Transaction Guarantee Facility for Access Bank Zambia Limited aimed at improving access to trade finance for small and medium enterprises across the country.
The facility is expected to support up to 240 million dollars in trade volumes over its five-year lifespan and will benefit Zambian businesses that have struggled to participate meaningfully in regional and international trade.
According to the African Development Bank, the guarantee will cover up to 100 percent risk to international confirming banks on trade finance instruments issued by Access Bank Zambia, helping the bank scale up financing to local traders and importers.
The Bank says the initiative comes at a time when many SMEs continue to face challenges accessing affordable trade finance, despite contributing about 70 percent of Zambia’s Gross Domestic Product and providing 88 percent of employment.
African Development Bank Country Manager for Zambia Raubil Olaniyi Durowoju says trade finance is critical in enabling small businesses to import certified seed, source manufacturing components and export finished products.
Mr. Durowoju says the partnership with Access Bank Zambia will help connect Zambian businesses to regional and global markets while supporting job creation and economic resilience.
The African Development Bank further says the facility will particularly support sectors such as agriculture, manufacturing and mining, which are considered key drivers of Zambia’s productive economy.
Meanwhile, Access Bank Zambia Managing Director Hellen Mwangi says the guarantee will help accelerate growth among SMEs by easing access to cross-border trade finance and deepening trade flows.
The facility will also include a gender inclusion component through the African Development Bank’s Affirmative Finance Action for Women in Africa programme, with part of the guaranteed trade book earmarked for women-led enterprises.
By Rachel Mumba
