In a strategic move aimed at bolstering economic growth and empowerment across Africa, United Bank for Africa (UBA) Plc. has teamed up with the African Guarantee Fund (AGF) to inject $100 million into Small and Medium Enterprises (SMEs) and green finance projects. The partnership, signed on Monday, March 11th, 2024, underscores UBA’s commitment to fostering entrepreneurship and sustainability across the continent.
Under the agreement, UBA will provide $100 million in new loans to SMEs and business owners in the 20 African countries where the bank operates. The AGF, on its part, will support and guarantee SMEs with a $50 million Portfolio Guarantee, with a focus on women-led businesses and environmentally friendly initiatives.
During the signing ceremony held at the UBA Head Office in Lagos, Oliver Alawuba, UBA’s Group Managing Director, emphasized the bank’s dedication to supporting SMEs, particularly those led by women. Alawuba highlighted the significance of the partnership in extending UBA’s reach and impact, aligning with the bank’s vision of empowering businesses and driving sustainable growth.
Furthermore, Alawuba reiterated UBA’s commitment to advancing the African Continental Free Trade Area (AfCFTA) initiative, reaffirming the bank’s $6 billion commitment to SMEs across Africa. This initiative aims to foster economic integration and prosperity across the continent.
In addition to providing financial support, UBA and AGF will engage in extensive capacity development initiatives for SMEs, offering free or highly discounted training programs. The partners also plan to collaborate with governments to create more conducive business environments for women entrepreneurs and expand green finance propositions across Africa.
Jules Ngankam, the Group CEO of African Guarantee Fund, expressed confidence that the partnership between these two pan-African institutions will drive significant economic growth by de-risking SMEs, especially those led by women and those operating in the green sector. Ngankam emphasized the crucial role SMEs play in African economies, comprising 90% of the private sector and accounting for 60% of all jobs.
This partnership builds upon UBA’s earlier commitment announced in September 2023, in collaboration with the Africa Continental Free Trade Area (AfCFTA) Secretariat, to channel $6 billion towards supporting SMEs across Africa. With this latest initiative, UBA continues to solidify its position as Africa’s global bank, driving inclusive growth and sustainability across the continent.