The board of directors of the African Development Bank Group (AfDB) has approved a $15 million trade finance line of credit and $10 million transaction guarantee for FSDH Merchant Bank.
The AfDB Nigeria country department made this known in a statement by Chukwuemeka Ezekiel, yesterday.
According to the statement, FSDH will use the line of credit to provide loans to local enterprises in Nigeria.
The $25 million package would help to reduce the trade finance gap in Nigeria by making financial resources available to small and medium-sized enterprises (SMEs) in the industrial sector.
The bank’s director general for Nigeria, Lamin Barrow said the availability of trade finance instruments to drive post-pandemic economic recovery efforts could not be overemphasised.
“Hence, the bank’s financing will help eligible Nigerian SMEs to take advantage of existing and emerging opportunities in the domestic and regional markets,” he said.
Barrow said the COVID-19 pandemic and other factors had led global banks to reduce their correspondent banking relationships in Africa or to exit completely.
Furthermore, the AfDB’s director for Financial Sector Development, Stefan Nalletamby said the bank was excited about finalising the facility with FSDH.
“We are excited about finalising this facility with FSDH as having the bank as a partner will aid FSDH in scaling up its trade finance offerings in Nigeria to help meet the ever-increasing trade finance gap.
