Hope as CRDB, AfDB, firm ink $110 million deal for women

Dar es Salaam. Women entrepreneurs in Tanzania must be smiling broadly as the African Development Bank (AfDB) and CRDB Bank Plc have signed a multi-million dollar package that will support their financing needs.

The two financial institutions yesterday signed a $60 million financial package which comprises of $50 million in subordinated debt to support CRDB’s regional expansion efforts and a senior loan of $10 million to support the Tanzanian lender’s efforts in availing women SMEs with access to finance.

This comes just one day after the AfDB announced in Dar es Salaam that it was unveiling a continental guarantee fund of $250 million (about Sh583 billion) that specifically seeks to cater for capital needs of women-owned SMEs in Africa.

The facility also comes complete with a technical assistance grant of $175,000 through AfDB’s Afawa [Affirmative Finance Action for Women in Africa] Initiative which is supported by the Women Entrepreneurship Initiative (WeFI) to strengthen CRDB’s capacity to support women entrepreneurs in Tanzania to become more bankable.

It also comes with the renewal by the African Guarantee Fund (AGF) of its guarantee line to CRDB Bank with $50 million (about Sh120 billion) package.

The line includes the Afawa Guarantee for Growth component to de-risk the women’s market and further support the growth of women SMEs. The Afawa Guarantee for Growth is part of the African Development Bank’s Afawa initiative which aims to unlock up to $5 billion for women businesses by 2026.

The AfDB’s director general for East Africa region, Ms Nnenna Nwabufo, the Group chief executive officer for the AGF, Mr Jules Ngankam, and CRDB Bank’s Plc chief executive officer, Mr Abdulmajid Nsekela signed the agreement package on behalf of their entities.

The bouquet of financing will enable CRDB to significantly impact the socio-economic growth of the region by empowering SMEs, especially women, and unleashing their full potential.

According to Mr Ngankam, the longstanding relationship between AGF and CRDB Bank has supported SMEs across various sectors. “This tripartite partnership is a game changer particularly to bridge the financing gap for women entrepreneurs,” he said.

Ms Nwabufo said the partnership would enable SMEs across the region to access finance as the lender expands further.

Apart from Tanzania, CRDB Bank Pls also operates in Burundi and will be opening its subsidiary in the Democratic Republic of Congo (DRC) before the end of this year as it ponders further expansion into other East and Central African countries.

The deal also adds to Tanzania’s efforts to close the access to finance gap for women entrepreneurs, which is estimated at $1.6 billion.

“We are very excited to have closed this agreement. The subordinated loan facility will improve the bank’s overall capitalisation and support future growth and regional expansion without jeopardizing capital ratios,” said Mr Nsekela.

He said the agreement with AfDB and AGF will support CRDB Bank’s commitment to assisting SMEs in building resilience and closing the working capital gap.

“The $10 million credit line and $50 million guarantee will strengthen our ability to support many women-owned businesses through our Women Access to Finance Initiative, which is run by CRDB Malkia,” he said.