Nomthandazo Gabi
Small to Medium Enterprises (SMEs) in Zimbabwe are set to receive a significant boost with First Capital Bank (FCB) securing a US$15 million trade finance facility from the African Development Bank (AfDB). This funding will enable FCB to provide essential financial support to SMEs, aiding their growth and development. Additionally, the AfDB funding will increase the availability of foreign currency in the country, allowing SMEs to meet their capital needs and contributing to national economic progress.
The recent approval of the FCB facility by the AfDB’s board of directors comes at a critical time, as Zimbabwe urgently needs hard currency to bolster its foreign reserves and support the newly introduced Zimbabwe Gold (ZiG) currency. The increased foreign currency availability in banks will also help combat the black market, a significant issue in the country.
For over two decades, Zimbabwe has faced sanctions leading to widespread company closures, job losses, and a rise in informal trading. Many informal traders depend on these activities for their livelihood. The FCB facility provides much-needed relief for these traders, many of whom operate as SMEs.
The FCB loan facility, specifically designed for SMEs, will enable these businesses to restock their products, thereby creating employment opportunities for many Zimbabweans affected by long-standing sanctions. President E.D. Mnangagwa has consistently emphasized the importance of collective effort towards improving Zimbabwe. With the FCB loan facility now in place, SMEs have a prime opportunity to work hard and generate employment. It would be unwise for SMEs not to utilize the funds available to replenish their products and grow their businesses.
