THE African Development Bank (AfDB) has approved a $15 million funding package for Zimbabwe’s First Capital Bank to provide trade finance for small and medium-sized enterprises (SMEs) and women-owned businesses, as reported by Global Trade Review.
The funding is divided equally, with $7.5 million allocated as a direct line of credit and the remaining $7.5 million designated for guarantees to overseas confirming banks. These guarantees will cover non-payment risks associated with First Capital’s trade finance transactions involving SMEs.
According to the AfDB, this financing aims to supply the necessary hard currency to help First Capital Bank bridge its trade finance gap and expand its support for SMEs and local corporations in Zimbabwe.
Approved on April 30, the funding package is expected to boost Zimbabwe’s inter-African trade, potentially catalyzing $146 million in trade over the next three years.
Moono Mupotola, the AfDB’s Zimbabwe country manager, emphasized the significance of the facility, stating, “The facility is expected to support the importation of strategic commodities and promote the integration of Zimbabwe’s economy into regional and global trade markets, which are essential for the country’s growth.”
Tapera Mushoriwa, CEO of First Capital Zimbabwe, highlighted the package’s role in enhancing the bank’s trade finance services within Zimbabwe, across Africa, and globally.
First Capital Bank was formerly known as Barclays Bank until 2017 when the Mauritius-headquartered First Capital Group acquired the UK lender’s majority share in the bank.
