The African Guarantee Fund (AGF), a leader in promoting financing of Small and Medium-sized Enterprises (SMEs) across Africa and FSD Africa, a pioneering development agency committed to reshaping Africa’s long-term financial landscape, have signed a strategic collaborative pact aimed at propelling the growth of Green SMEs by providing critical financial support, technical assistance, and capacity building.
A news report from the African Press Organization (APO) Group distributed on behalf of AGF indicated that the cooperation agreement outlined detailed framework collaboration between the two organizations in boosting sustainable development in Africa, which involve assisting in the development of financial products for institutions, offering partial credit guarantees for bonds and funds raised on behalf of SMEs, and conducting capacity-building events.
Furthermore, by providing financial support and fostering business growth, Green SMEs are expected to play a pivotal role in reducing CO2 emissions.
According to the news report, the active contribution aligns with the overarching goal of preserving the environment and facilitates access to finance for business growth and empowering SMEs to generate and sustain employment opportunities, especially for youth and women.
Speaking during the agreement signing, Chief Executive Officer of FSD Africa, Mark Napier, said: “This partnership represents an important milestone in our efforts to foster sustainable economic development in Africa.
“By leveraging the strengths of FSD Africa and the African Guarantee Fund, we will actively create a robust ecosystem that empowers Green SMEs. This collaborative effort aims at facilitating access to affordable long-term funds, thereby accelerating the transition towards a greener and more resilient economy”, the investment expert added.
Similarly in his remarks, AGF Group Chief Executive Officer, Jules Ngankam, said: “Fostering a green economic transformation in Africa is one of our key priorities. Through this partnership, AGF will provide financial institutions with bank fundraising guarantees to enable them access affordable funds aimed at facilitating loans to SMEs investing in low carbon and climate resilient businesses.
“Additionally, AGF will extend partial credit guarantees to lenders in a bid to enhance credit accessibility for Green SMEs, empowering them to flourish and make meaningful contributions to environmental conservation” Ngankam added.
The two organisations will also provide technical assistance on green financing initiatives, which is critical in building the capacity of key stakeholders such as Governments, Financial Institutions, and Green SMEs.
