Firms partner to improve SMEs financing in West Africa
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The African Guarantee Fund (AGF) has signed a partnership agreement with Vista Group Holding to improve access to finance for small and medium enterprises (SMEs) in four West African countries of Burkina Faso, The Gambia, Guinea, and Sierra Leone.
The collaboration will see AGF provide a loan portfolio guarantee of $50 million to support Vista Group Holding’s lending activities to SMEs across its network in the four target countries.
The partnership aimed at unlocking growth opportunities for West Africa’s SMEs by scaling up SME financing and contributing to economic development in the region.
By focusing on underserved markets, the partnership is expected to promote financial inclusion by increasing access to finance for entrepreneurs, including women-owned SMEs, green businesses, and youth entrepreneurs.
Also, AGF’s risk-sharing guarantee will mitigate potential risks associated with SME lending, bolstering the financial stability of Vista Group and its subsidiaries.
Group Chief Executive Officer, African Guarantee Fund (AGF), Jules Ngankam said the group was excited to partner with Vista Group as the collaboration would leverage combined expertise and resources to unlock the immense potential of SMEs in the region, driving inclusive economic growth through increased access to financing.
Ngankam said as a catalyst for regional collaboration, the partnership aligns with both AGF’s mission to promote economic development and reduce poverty in Africa, and Vista Bank Group’s ambition to become a leading pan-African financial institution focused on economic and financial inclusion.
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Managing Director, Vista Group Holding, Yao Kouassi said partnering AGF was a significant step in the company’s mission to empower SMEs and contribute to financial inclusion across West Africa.
“This facility will enable us to expand our reach and provide crucial financial support to businesses that are driving economic development in these countries. This aligns with our goal to expand our footprint beyond the Guinean Market to ECOWAS and the Central African Economic and Monetary Community (CAEMAC),” Kouassi said.
Additionally, the partnership leverages the Affirmative Finance Action for Women in Africa (AFAWA) Guarantee for Growth programme that aims to unlock up to $3 billion in financing for Women SMEs in Africa through financial institutions.
African Development Bank’s Togo Office Country Manager, Wilfrid Abiola, said the partnership reflected the commitment of the African Development Bank, especially through the AFAWA initiative, to empower women entrepreneurs while promoting economic growth in the West African region.
“With 20 per cent of this transaction allocated to women-led small and medium-sized enterprises, along with tailored technical assistance support provided by AFAWA, Vista Group Holding is taking the commitment to de-risk women-led businesses in their portfolio and making great strides in transforming access to finance for women-led small and medium enterprises in low-income countries and fragile states,” Abiola said.
The AGF is a specialised guarantee provider whose mission is to facilitate economic development and poverty reduction in Africa. It has unlocked more than $3.5 billion in SME financing, through partnerships with 200 partner financial institutions across 40 African countries. AGF is rated AA- by Fitch Ratings.
AGF is backed by several shareholders and sponsors including Government of Denmark through the Danish International Development Agency (DANIDA), Government of Spain through the Spanish Agency for International Cooperation (AECID), African Development Bank (AfDB), French Development Agency (AFD), Nordic Development Fund (NDF), Investment Fund for Developing Countries (IFU), German Development Bank (KfW), French Agency for Private Sector (PROPARCO), West African Development Bank (BOAD), Global Affairs Canada (GAC) and USAID’s West Africa Trade & Investment Hub (WATIH).
