Banking and PaymentsBusinessNews

African Guarantee Fund Avails UGX37bn to Centenary Bank to Ease Lending for SMEs

On Tuesday, non-bank financial institution; African Guarantee Fund (AGF) signed a 5-year partnership with Centenary Bank which sees USD$10 million (roughly UGX37 billion) availed to the bank to ease lending for SMEs.

The partnership which aims de-risking finances towards SMEs in Uganda was signed by Fabian Kasi; MD & CEO of Centenary Bank, and Felix Bikpo; CEO of AGF Group.

Fabian during the press brief said, the partnership will be able to ease access of finances for SMEs without necessarily looking for collateral that banks ask for. In addition, enable them provide long-term loans which wouldn’t have been possible for most of the commercial loans that banks offer.

Offering these loans to SMEs, Fabian noted that interest rates will be slightly lower than the normal ones because the credit risk levels are now reduced.

Centenary Bank is reported to have extended loans worth UGX160 billion (roughly USD$43.2 million) in 2018 to 3,500 SMEs a number the bank is looking to expand.

He said, “more solutions are still needed to address challenges SMEs face, among which include; access to finance, skills on financial management, and funding.”

Seconding Fabian’s remarks, Bikpo said; “the private sector in Africa is 90% constituted by SMEs but the major problem is access to finance.”

He noted that AGF’s objective is to provide partial credit guarantees and capacity development to financial institutions to stimulate financing of SMEs.

“We have partnered with centenary because the bank understands the real challenges facing in Africa,” said Bikpo.

AGF is reported to have footprints in 40 African countries, and to date have supported over 20,000 SMEs across Africa.


Staff Writer

All articles published by Staff Writer have been contributed by all our reporters and edited and proofread by our editorial team.
Back to top button

Adblock Detected

Please disable your adblocker to continue accessing this site.