Key Takeaways
- The African Development Bank has approved a $310 million financial package for FirstRand Bank.
- Funding is aimed at expanding access to finance for MSMEs, with a strong emphasis on women-led businesses and agribusinesses.
- The package includes a $200M MSME credit line, a $100M gender-focused credit line, and a $10M concessional agrifood facility.
- Over one-third of the total funding is ring-fenced for women-owned enterprises, aligned with AFAWA and ACFM initiatives.
- Technical assistance and performance-based incentives will support implementation and financial inclusion efforts.
African Development Bank Approves $310 Million to Support MSMEs
The African Development Bank has approved a $310 million financing package for FirstRand Bank, one of Africa’s largest financial institutions. The initiative aims to expand access to capital for micro, small, and medium-sized enterprises across South Africa, with a particular focus on women-led businesses and agricultural enterprises. FirstRand Bank is a fully owned subsidiary of the FirstRand Group.
Kennedy Mbekeani, Director General for Southern Africa at the African Development Bank, stated, “This approval highlights the African Development Bank's dedication to bolstering the private sector and fostering inclusive economic growth in South Africa.”
African Development Bank Emphasizes Gender-Focused Lending
A defining element of the package is its gender lens: $110 million is explicitly allocated to women-led or women-owned MSMEs. This segment aligns with the Bank’s Affirmative Finance Action for Women in Africa (AFAWA) initiative and the Agri-Food SME Catalytic Financing Mechanism (ACFM), both designed to address the gender financing gap.
The package includes three components:
- $200 million general MSME on-lending line
- $100 million targeted line dedicated to women-owned MSMEs
- $10 million concessional facility for women-owned agricultural SMEs
The concessional funding is specifically ring-fenced for women operating in agriculture, a sector where smallholder farmers often struggle to access traditional banking credit.
Additional Support Through Technical Assistance Programs
Complementary technical assistance and performance-based incentives will be provided through AFAWA and ACFM. These tools aim to strengthen the bankability of women-led enterprises, support FNB’s agriculture portfolio, and explore alternative credit scoring models to widen access to finance.
Ahmed Attout, Director of the Financial Sector Development Department, noted that the package reflects a shared commitment to “driving inclusive economic growth and empowerment of the heavily credit-deprived business communities of South Africa.”
Partnership Supports South Africa’s Inclusive Growth Goals
Representatives from FirstRand emphasized the role MSMEs play in economic and community development. “MSMEs are significant contributors to South Africa’s economic growth,” said Bhulesh Singh, FirstRand Group Treasurer, highlighting FNB’s role in supporting women-owned and agricultural businesses.
This initiative aligns with the African Development Bank’s Four Cardinal Points and its Ten-Year Strategy (2024–2033), focusing on inclusive growth, gender equality, and private sector development.
