By Cynthia Ezekwe.
Multinational pan-African financial services group,United Bank for Africa (UBA), has unveiled a $6 billion financing initiative, to support and boost activities of Small and Medium scale Enterprises (SMEs) across the African continent.
Through this initiative, UBA will be giving SMEs the opportunity to access financing for small businesses that specialise in the key sectors of agro-processing, pharmaceuticals, automotive and transport and logistics.
The financing initiative, aimed at providing $6 billion funding to eligible SMEs across Africa, within the next three years, is powered by UBA’s recent partnership with the African Continental Free Trade Area (AfCFTA) secretariat, an agreement which was signed on the sidelines of the 30th Afreximbank Annual Meeting (AAM), held in Accra, Ghana.
Muyiwa Akinyemi, deputy managing director of UBA, signed the agreement on behalf of the bank, in line with the bank’s strategic focus on the SME segment as a catalyst for the economic development of Africa, noting that UBA remains committed to supporting the growth/development of SMEs across Africa. This is
“Under this partnership, UBA will go beyond just financing to provide non-financial services to these SMEs to develop the capacity for growth across the 20 African countries that we are present in and build sustainable business practices,’’ Akinyemi said.
“We shall also be leveraging technology to deliver our financing activities to the beneficiaries and this platform provides us with a unique opportunity to stimulate the development of the continent as Africa’s Global Bank,” the deputy managing director added.
Alero Ladipo, UBA’s group head, marketing and corporate communications, highlighted the bank’s commitment to offering $240,000 in financing, a support that will be extended through a mix of working capital loans and asset finance loans, with the ultimate goal of positioning SMES for success in Africa’s evolving business landscape.
Ladipo explained that the SMEs in the particular sectors of Agro-processing, automotive, pharmaceuticals, transport and logistics, will be able to access a working capital loan by way of overdrafts and short-term loans with a maximum value of $120,000 in each of their country’s local currency; and asset finance loan of up to $120,000 in the local currency of the obligor, to use for the acquisition of operational assets and equipment to meet their business expansion needs.
She pointed out that this strategic move aligns with UBA’s vision to be a catalyst for economic development across Africa,noting that by empowering SMEs in key sectors, the bank is fostering job creation, enhancing local production, and promoting intra-African trade, all of which are pivotal goals of the AfCFTA agreement.
In addition to financial support, she emphasised the bank’s commitment towards providing capacity-building opportunities for SMEs, through various training programs and resources, and how UBA aims to equip the businesses with the knowledge and skills needed to thrive in a competitive market environment.
“UBA recognises the critical role that SMEs play in driving economic growth and job creation. To facilitate their growth and success. To this end, We are proud to be at the forefront of driving entrepreneurship in Africa,’’ Ladipo said.
“Our partnership with AfCFTA and our commitment to SMEs in these critical sectors reflect our dedication to the economic transformation of our continent. We believe that this initiative will not only benefit individual businesses but will also contribute significantly to the overall development and prosperity of Africa,’’ she added.