African Guarantee Fund and Bank Of Industry Sign $50m Guarantee Framework Agreement

African Guarantee Fund (AGF) and Nigeria’s Bank of Industry (BOI) have signed a USD 50 Million Loan Portfolio Guarantee framework in a bid to propel Nigeria’s industrial sector by providing financial and business support services to enterprises. The agreement that was signed at the Africa Investment Forum in Rabat is backed by African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA) initiative.

The transaction will be phased out in three tranches over a 10-year period and will significantly scale up BOI’s lending to Small and Medium Enterprises (SMEs) in Nigeria.

The partnership includes a comprehensive risk sharing mechanism that focuses on supporting MSMEs, Women-Owned enterprises and Green businesses to promote environmental sustainability and gender equity.

Speaking during the signing ceremony, AGF Group Chief Executive Officer, Mr. Jules Ngankam said “This transaction with the leading Development Finance Institution in Nigeria is a great milestone that will significantly impact Nigeria’s economy by unlocking up to USD 100 million in financing for SMEs. AGF will also provide tailored guarantees and technical assistance towards the special SME products offered by BOI, targeting Women, Youth and Green Businesses.”

The MD/CEO of the Bank of Industry, Dr. Olasupo Olusi, said, “BOI is excited to leverage the guarantee framework of the African Guarantee Fund in promoting sustainable growth, gender equity, innovation and advancing more credit to SMEs in Nigeria in line with President Bola Tinubu’s government’s Renewed Hope agenda”.

Dr. Beth Dunford, Vice President for Agriculture, Human and Social Development said, “This strategic partnership illustrates the commitment of the African Development Bank, especially the Affirmative Finance Action for Women in Africa (AFAWA) initiative, to empower women entrepreneurs and foster economic growth in Nigeria. It is not just a financial transaction aimed at supporting and catalysing the growth of small and medium enterprises in Nigeria; it is a beacon of hope and progress for African businesses, particularly for those led and owned by women.”

This agreement signifies the start of a long-term strategic relationship, and it provides a perfect intersection of the AGF’s mission to unlock financing for SMEs, and BOI’s mandate to catalyse Nigeria’s industrialization and economic transformation.