Jules Ngankam, the Group Chief Executive Officer of the African Guarantee Fund (AGF), announced the organization’s commitment to bridging the $300 billion financing gap for small and medium-scale enterprises (SMEs) in Africa. Ngankam made this revelation during a press conference ahead of the ninth edition of the Green Finance Conference, scheduled to commence in Lagos.
Addressing the significant SME financing gap in Africa, Ngankam outlined AGF’s approach, which includes offering both financial and technical solutions. He emphasized the importance of addressing information gaps by providing technical assistance and capacity building to SMEs, enabling them to improve their financial record-keeping and risk assessment capabilities.
AGF also collaborates with financial institutions to leverage new technologies such as big data and artificial intelligence (AI) for more accurate risk assessment based on SME-provided information.
Another critical gap addressed by AGF is the collateral gap, where SMEs often lack the required collateral to secure financing. AGF provides guarantees to financial institutions, effectively replacing the need for traditional collateral.
Additionally, AGF works to address the tenor gap, which involves mismatches between SMEs’ financing needs and the offerings of financial institutions. By facilitating access to medium to long-term loans, AGF supports SMEs in expanding their businesses and driving growth.
Ngankam highlighted AGF’s focus on supporting SMEs in the green space and female-owned businesses, underscoring the organization’s commitment to fostering inclusive and sustainable economic development.
Honorary Consul of Finland in Lagos, Bankole Oloruntoba, emphasized the importance of providing technical assistance to SMEs to enhance their access to finance, while former CEO of the Bank of Industry, Kayode Pitan, encouraged SMEs to leverage the financing opportunities provided by AGF through Nigerian banks.
AGF has collaborated with prominent Nigerian banks such as United Bank for Africa, FCMB, and Access Bank to address the financing gap not only in Nigeria but across the continent, demonstrating its commitment to supporting SMEs and driving economic growth in Africa.
