In a move that is set to change the face of supply chain and SME financing in Africa, the African Export-Import Bank (Afreximbank) and the supply chain financing company, Fiducia, have entered into a Memorandum of Understanding (MoU) to promote factoring across the continent and help reduce the supply chain finance gap.
Signed by Kanayo Awani, Afreximbank’s Executive Vice President, Intra-African Trade Bank, and Imohimi Aig-Imoukhuede, Chief Executive Officer of Fiducia, the MOU aims to facilitate collaboration between the two parties to harmonize their efforts to achieve the stated objectives.
According to the MoU, Afreximbank is partnering with Fiducia in order to provide additional liquidity for trade facilitation through factoring on the Fiducia marketplace. The Bank will also explore collaboration opportunities with Fiducia and Access Corporation for payables financing across African markets.
Speaking on the partnership, Mr. Aig-Imoukhuede, the Chief Executive Officer of Fiducia, remarked, “This MOU reflects the benefits for SMEs which a partnership between Fiducia and Afreximbank can drive. One such benefit is the deepening of the Nigerian Supply-Chain Financing landscape, through on-lending to Financiers (both Banks and non-Bank Factors) for use on the Fiducia marketplace platform.
This will further lower funding costs on the platform and ensure strengthening and development of suppliers and buyers alike, by promoting availability of capital to facilitate trade. Similarly, the 2 partnering entities will work together to apply similar marketplace benefits to MSMEs across the African continent”.
Mrs. Awani, the Afreximbank Executive Vice President, said that the partnership with Fiducia was another step forward in Afreximbank’s ongoing developmental initiative of promoting factoring across the African continent as a means to reduce the trade finance gap which was most acutely felt by SMEs.
“SMEs contribute the majority of economic output and employment generation in Africa. Greater access to bank financing will, therefore, enhance the growth of this vital segment. The involvement of emerging factors in the financing arrangement will also build factoring capacity across the continent in furtherance of Afreximbank’s vision of Transforming Africa’s Trade,” commented Mrs. Awani.