Afreximbank has extended a $10 million financing facility to Azania Bank of Tanzania to expand access to working capital and medium-term finance for small and medium-sized enterprises operating across the country’s export value chains.
The facility is being provided under Afreximbank’s Export SME Development Programme and is intended to support eligible businesses with financing for expansion, asset acquisition and pre- and post-export activities.
Using a domestic bank to reach exporters
The structure illustrates how a continental development-finance institution can use a domestic commercial bank to move trade finance closer to smaller businesses that may not have direct access to large institutional lenders.
Access to working capital can be particularly important for exporters, which may need to finance production, inventory, logistics and other costs before receiving payment from customers.
Connecting SMEs to regional trade
Afreximbank says the facility is intended to strengthen Tanzanian SMEs’ participation in regional and international trade, including opportunities emerging from deeper African economic integration.
The $10 million is a financing facility extended to Azania Bank for on-lending to eligible SMEs. It is not a grant or a direct distribution of $10 million among Tanzanian businesses.
Sources
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