By JUDITH NAMUTOWE –
THE Africa Development Bank (AfDB) has approved a four-year US$125 million Africa Small and Medium Enterprises (SME) programme.
This is combined with a US$3.98 million technical assistance package granted by the Fund for Africa Private Sector Assistance (FAPA), aiming at supporting micro, small and medium enterprises (MSME) in Africa.
According to the bank’s annual report, in July 2013, the AfDB board of directors approved the Africa SME programme, which would standardised lines of credit (LOC), mostly in local currency, and technical assistance to targeted financial institutions, predominantly in low-income countries spread over all African regions.
In Zambia, CETZAM which has been selected to participate in phase-one of the programme has been awarded US$1.5 million LOC with a five-year maturity including a one year grace period and FAPA grant of up to US$100,000 to develop its ESMS system and strengthen its information system as well as credit and portfolio risk management systems.
The bank has continued to support the Zambia SME sector through various initiatives aimed at facilitating SMEs access to finance, consisting of a financial and technical assistance component.
The financial component provided LOC to Zanaco amounting to US$10 million, while investrust received US$3.5 million.
The report said of the partial credit guarantee facility of US$10 million US$8 million was granted by AfDB and $2 million granted by USAID to Zanaco.
The FAPA technical assistance component of $980,824 included capacity building support to financial institutions, business development services providers and SME associations implemented By African Training and Management Services (ATM) /African Management Services Company (AMSCO).
The report said 65 SMEs benefited from the LOC which has also resulted in the creation of more than 1000 jobs by SEMEs of which 400 were created by women.
The programme, through the FAPA grant has trained staff in both commercial banks in SME credit risk management.
“In addition the number of SMEs trained on management and financial skills under financial literacy training stood at 1080,” the report said.
