The African Guarantee Fund AGF and Equity Bank have renewed their strategic partnership by signing a 500m framework aimed at enhancing lending to small and medium-sized enterprises SMEs and driving job creation across the region.
This agreement marks the largest guarantee engagement in AGF's history and paves the way for Equity Bank to significantly scale up its lending capacity to SMEs in Kenya, Uganda, Rwanda, Tanzania, and DR Congo. According to a joint statement released by the institutions, the initiative is projected to unlock 1bn in new financing for SMEs and create or sustain over 50,000 jobs.
"The framework will be implemented in three phases, starting with an initial USD 115 million tranche already committed to the five core subsidiaries. It will cover loans to MSMEs, with a focus on women-owned, youth-led, and green enterprises," the statement read.
Laboratory of SME financingSpeaking at the signing ceremony, Felix Bikpo, chairman of the board of directors of AGF, emphasised that the renewed partnership with Equity Bank was informed by the latter's track record in SME financing.
"Equity Bank is the laboratory of SME financing," he declared. "It has leaders that understand that we can be financially sustainable and make a good social impact we can be financially sustainable while financing SME business."