BankABC receives P500m war chest from AfDB to fund SMEs

AfDB President Donald Kaberuka (Pic By AfDB)

AfDB President Donald Kaberuka (Pic By AfDB)

ABC Holdings Ltd, the pan African banking group also trading as BankABC has receieved another war chest from another development financial institution to finance small businesses where it operates.

The unlisted bank has been given access to US $50 million multi-currency line of credit by African Development Bank Group (AfDB) to allow the Botswana domiciled bank to reach out to SMEs in Africa.

“The AfDB LoC will enable ABCH and its three selected subsidiaries to reach a larger number of SMEs across a wide range of sectors by offering medium- to long-term loans, which are not currently accessible for local SMEs,” said the Donald Kaberuka headed multilateral development finance institution.

“The AfDB will provide local currencies, Botswana Pula and Mozambique Metical to support local currency lending and promote development of the financial sector in these countries.”

According to the bank, the facility will also cover Zimbabwe where many enterprises face liquidity challenge and it will support at least 200 SMEs and generate 800 jobs, including 400 jobs for women, during the period of the project.

“Leveraging the relatively long tenor of the AfDB facility, it is expected to increase the average loan tenor for SME clients who can consequently expand their business, which will promote inclusive growth of these countries,” the Tunis based bank added.

ABC Holdings Ltd. (ABCH) is a rapidly growing financial institution targeting local small and medium enterprises (SMEs) in these countries covering various sectors such as construction, agriculture, manufacturing, transport and services. ABCH is gradually increasing its SME portfolio share targeting 30% by end 2018 as it plans to expand its retail network across countries.

The bank last year announced a €25 million or P290 million loan facility from European Investment Bank (EIB), the world largest public bank to finance Small and Medium Scale businesses at a time when commercial banks in the country are craving liquidity on the back of struggling economy.

EIB said it was financing a bank for the first time in Botswana and the last time the bank provided funding was on Fabulous Flowers, a failed flower exporting company seven years ago.

The funds were geared towards propping up the small business sector where € 20 million will go towards medium sized companies and €5 million is allocated to smaller SMEs and micro enterprises.

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