The International Finance Corporation, IFC, a member of the World Bank Group, recently announced a 200 million Zambian kwacha (approximately $15 million) loan to Stanbic Bank Zambia, a wholly owned subsidiary of Standard Bank Group, to help Stanbic Bank expand its lending to small and medium enterprises, with at least 25% of the loan earmarked for women-owned businesses in Zambia.
Zambia’s entrepreneurs have difficulty in accessing the finance they need to grow due to informality in the market, high collateral requirements, and poor bank lending tools, according to a recent study by the World Bank Group.
Here Is The Deal
The loan will particularly be targeted at Zambia’s women-owned enterprises who face a financing gap of about $474 million, equivalent to 16% of the total SME finance gap funding shortfall (The Global Findex Database 2017).
The funding from IFC is timely and fits with our SME strategy, which is aimed at leveraging our corporate banking ecosystem to identify new SMEs for funding.
Leina Gabaraane, chief executive officer — Stanbic Bank Zambia.
By 2022, we plan to quadruple the number of women-owned SME borrowers from 50 to about 200, representing an outstanding portfolio of 80 million Zambian kwacha, up from 16 million Zambian kwacha.
Leina Gabaraane, chief executive officer — Stanbic Bank Zambia.
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- Along with the financing, IFC will help Stanbic Bank enhance its environmental and social risk management system. This includes formulating detailed procedures for identifying, assessing, and managing risks and their impacts during the credit approval and monitoring process.
IFC’s partnership with Stanbic Bank Zambia will expand access to finance for the country’s SMEs, enabling them to grow and create jobs.
Kevin Njiraini, regional director for IFC — Southern Africa
The project also marks a new frontier in IFC’s relationship with the Standard Bank Group, and we look forward to future engagement with the group’s other subsidiaries.
Kevin Njiraini, regional director for IFC — Southern Africa
IFC estimates that SMEs that receive financing through Stanbic Bank’s new line could create close to 3,000 local jobs over the next five years.
Stanbic Bank Zambia is a leader in the Zambian banking sector and has a market share of about 15% by total assets and 21% by loans. It will leverage its recently launched banking proposition for women, called Anakazi Banking, to attract women-owned enterprises.
This will be IFC’s second investment with Stanbic Bank Zambia after a $11 million subordinated loan in 2006.
How To Access The Loan
Anakadzi Banking
There are different channels established by Stanbic Bank Zambia through which startups and SMEs in Zambia can access the loan. One of such is Anakadzi Banking.
Anakadzi Banking is designed for women, by women and aims to reward the discerning woman who reaches for the stars and has the drive to turn her dreams into a reality.
Business Term Loans
Stanbic Bank Zambia’s Business Term Loan supports businesses in achieving their long-term financial goals. To make repayments suitable for your business, monthly instalments are matched to your business’ cash flow. The term of your loan can be structured for between 3 and 5 years.
What does it offer?
- A Business Term Loan may be used to buy or upgrade fixed property, finance fixed assets, capital expenditure or for the set-up of venture costs
- A term loan may, however not be used for the consolidation of debt or as a substitute for vehicle and asset finance.
Who can apply?
Business clients with an existing transactional account with Stanbic Bank Zambia.
To know more, contact any Stanbic Bank in Zambia nearest to you.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.