Shari’ah-compliant financier Gulf African Bank has partnered with the African Guarantee Fund (AGF) in a deal that will provide up to Sh550 million credit guarantee to women-owned Small and Medium-Sized Enterprise (SME) loans.
The credit risk guarantee collateral cover seeks to avail financing facilities to SMEs that qualify for a loan but lack enough collateral.
“We are proud to have partnered with AGF to roll out the first Shari’ah compliant credit risk guarantee scheme in sub-Saharan Africa,” said Anuj Mediratta, the Managing Director at Gulf African Bank.
“Through this partnership, we are going to finance more SMEs thereby allowing them to play their role in driving Kenya’s economic growth. We also share a mutual goal of expanding the SME space in Kenya, to ensure that more jobs are created.”
The bank aims to scale its financing to women-owned enterprises and green businesses that are involved in renewable energy produce eco-friendly products and services or offer green services.
“We are here to celebrate the first Shari’ah guarantee we’ve signed in Sub-Saharan Africa, which will enhance inclusion with a segment of the population for whom it is important to use Shari’ah-compliant facilities and this will help AGF grow its portfolio,” said Mr Frank Adjaba, director of business development at AGF.
This is because the agreement is supported by the African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA) and will significantly increase the financing of women SMEs.
“AGF has today entered into a first-of-its-kind guarantee partnership to support Gulf African Bank’s SME financing strategy in line with the approved Shari’ah principles…AGF will additionally provide capacity development assistance to increase the bank’s capacity to appraise SMEs and implement growth strategies,” said Mr Jules Ngankam, AGF chief executive officer.
