French agency gives Sh3.7bn to support African SMEs
2 December 2019
Source: Daily Nation
The African Guarantee Fund (AGF) has received Sh3.7 billion (USD30 million) from the French Development Agency (AFD) to support small and medium sized enterprises (SMEs) in Africa.
The fund seeks to improve access to credit by SMEs throughout Africa besides supporting the risk of financing private investments.
The agreement by the two institutions was signed by AFD Chief Executive Officer Rémy Rioux and AGF Group Chief Executive Officer Félix Bikpo in Paris on November 28, 2019.
Mr Bikpo said the agreement broadened the existing cooperation between the two organisations by providing AGF with a counter-guarantee of USD 30 million, using the ARIZ risk-sharing mechanism and a support for the risk of financing private investments.
“Through its leverage effect, this counter-guarantee will enable AGF to extend guarantees of USD60 million to local financial institutions, thereby allowing the latter to lend a total of USD120 million to African SMEs. It is estimated that such an amount of loans will benefit 1,800 SMEs and support 5,400 jobs,” Mr Bikpo said.