Fresh lifeline for SMEs to restructure and repay loans

With the lingering negative impact of Covid-19 on businesses, SMEs will now enjoy further respite through the African Guarantee Fund (AGF), a non-bank financial institution that is jointly owned by the Danish and Spanish governments as well as the African Development Bank (AfDB). The AGF is to guarantee small and medium enterprises (SMEs) to have their loans with commercial banks restructured and ease capital pressure on such businesses.

The AGF Covid-19 Guarantee facility is designed to allow SMEs to pay less over a given period than what they had been paying and therefore cope better in the face of the Covid-19 while reducing the potential default risks exposed to by the financial institutions .

This initiative of the AGF is to complement the already in place monetary policy interventions of several central banks in Africa and to support the drive to stabilise African economies from the impact of the Covid-19 pandemic.

About the Author: SME Enabler

You might like

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: