AfDB approves $20M trade finance guarantee for Access Bank Zambia to boost SME participation in cross-border trade (innovation-village.com, Sun, 28 Jun 2026)

The African Development Bank’s Board of Directors approved a $20 million trade finance guarantee facility for Access Bank Zambia on June 28, 2026, to support small and medium-sized enterprises in Zambia. According to AfDB officials, the unfunded guarantee will provide up to 100% risk coverage to international banks confirming trade transactions, aiming to boost SME participation in cross-border trade over the next five years.

The $20 million trade finance guarantee facility approved by the African Development Bank (AfDB) is structured as an unfunded Transaction Guarantee (TG) to support Access Bank Zambia in confirming trade finance transactions. AfDB officials said the guarantee will provide up to 100% risk coverage to international banks confirming trade transactions originated by Access Bank Zambia, targeting instruments such as letters of credit, trade loans, and other short-term trade products used in cross-border transactions. The facility is designed to mitigate credit and country risk, thereby facilitating easier acceptance of trade instruments issued by Access Bank Zambia’s SME clients by foreign banks.

The guarantee is expected to support up to $240 million in trade volumes over a five-year period, representing a leverage factor of approximately 12 times the guarantee amount, according to AfDB sources.

This medium-term support aims to enhance the ability of Zambian SMEs to participate more actively in regional and global value chains. AfDB officials confirmed that the facility will unlock additional liquidity from international confirming banks that might otherwise be constrained by perceived country and counterparty risk, thus expanding trade finance availability for small and medium-sized enterprises.

The facility targets SMEs that have historically struggled to secure trade finance due to limited collateral, short operating histories, or higher perceived risk, officials said. It aims to improve access to letters of credit for importing agricultural inputs, manufactured goods, solar panels, and other essential commodities, while also supporting export-oriented SMEs to compete more effectively in regional and international markets. The initiative is expected to facilitate import financing and access to regional markets and business supplies for Zambian SMEs, according to trade finance experts.

A gender-focused component is included through AfDB’s Affirmative Finance Action for Women in Africa (AFAWA) program. AfDB representatives said AFAWA’s involvement seeks to increase support for women-led enterprises engaged in trade and value-added activities by improving their access to letters of credit and other trade finance instruments. The program aims to narrow the financing gap for women entrepreneurs in Africa by leveraging guarantees to attract private capital, aligning with AfDB’s broader financial inclusion and private-sector development strategies.

The guarantee marks the first trade finance operation between AfDB and Access Bank Zambia, establishing a new institutional partnership in Zambia’s trade finance market, according to AfDB officials. Access Bank Group operates in multiple African countries, and AfDB has assessed the group’s environmental and social management systems as generally sound in related operations, supporting its role as an implementing partner. This facility complements similar AfDB trade finance guarantees, such as the $7 million facility granted to Access Bank DR Congo to support SMEs and local businesses.

The approval of the guarantee was reported in late May 2026, following a decision by AfDB’s Board of Directors. Economist Trevor Hambayi commented that AfDB’s internal processes will likely take a few months before the funds and risk coverage become fully available to the market. Hambayi said the facility is expected to start entering the market within the year, subject to the completion of operational frameworks and documentation between AfDB, Access Bank Zambia, and international confirming banks to define eligible transactions and guarantee terms. He added that the guarantee will help Access Bank Zambia expand trade finance access to businesses that have struggled to secure funding, particularly SMEs.

This facility is part of AfDB’s broader Trade Finance Program, which has supported more than $13.8 billion in trade volumes across Africa since 2013 through guarantees and funding to financial institutions. The program focuses on risk mitigation and liquidity support to increase trade finance access for SMEs and local corporates. By partnering with Access Bank Zambia, AfDB aims to strengthen private-sector banks’ capacity to support cross-border trade, aligning with regional integration and private-sector development priorities in Southern Africa.