Partners & Projects

NABII Zambia

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Grant Amount:

The Project

In Zambia, fewer than 30% of SMEs have access to formal sources of financing, and even those that do, face lending rates ranging from 22-30%, preventing them from accessing the capital they need to improve productivity, efficiency, and growth. This project, with a private-public partnership model, can address that gap by establishing a credit guarantee fund (CGF) that helps expand the capacity of Financial Service Providers (FSPs) and unlocks institutional capital from pension funds and other investors. It flows from an effort that began in 2020, when the Bank of Zambia (BOZ) launched the Targeted Medium-Term Refinancing Facility (TMTRF), a K10 billion (approximately $545 million) fund offering FSPs a credit line to support businesses and households impacted by COVID-19. That experience led the BOZ and the National Advisory Board for Impact Investment Zambia (NABII Zambia) to work towards establishing the CGF to further support local SMEs. The framework supports enterprise lending while mitigating key risks, with catalytic capital playing a foundational role in its development.

Value and Outcomes

This project is designed to fuel progress related to several of the UN Sustainable Development Goals (SDGs): SDG 5 (Gender Equality), SDG 8 (Decent Work and Economic Growth), SDG 16 (Peace, Justice and Strong Institutions), and SDG 17 (Partnerships for Goals). It will also help local FSPs to support financial innovations and participate in blended finance instruments benefiting local SMEs. The project is expected to serve as a replicable model with which financial leaders in emerging economies can address systemic gaps.

For more information on NABII Zambia, visit their website.

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