|Approval Date||12 May 2017|
|Signature Date||31 Aug 2018|
|Sovereign / Non-Sovereign||Non-Sovereign|
|DAC Sector Code||24030|
The project is a line of credit (LOC) of USD 25 million with a maturity of 10 years, including a 2-year grace period, to Swaziland Development Finance Corporation (Fincorp). Fincorp is a critical development financial institution in Swaziland. It was formed to finance Swaziland’s private sector enterprises and thus facilitate job and wealth creation as well as a means of promoting Small & Medium Enterprises (“SMEs”) in Swaziland. The LOC will be split into two tranches: (i) USD 9 million based on Fincorp’s balance sheet; and (ii) USD 16 million to be guaranteed by the Government of Swaziland. The facility will help to: i) enhance Fincorp’s liquidity ii) provide scarce and competitively priced longer term funding and lower its cost of funding to meet its growth and financing needs. The combined LOCs will be used for on-lending to sub-borrowers in various sectors (manufacturing, logistics, forestry, agribusiness, and building and construction) in Swaziland. The Bank will also provide a technical assistance (TA) grant of at least R5.1 million (USD375, 000), under the FAPA Africa SME Program Technical Assistance package, to strengthen Fincorp’s implementation capacity, especially its SME business development efforts and risk management framework.
The proposed support to Fincorp will help strengthen and scale up support to critical sectors in Swaziland, support efforts to promote private sector and diversify the economy. The facility will: facilitate support to entrepreneurship, avail medium term funding to critical sectors in Swaziland, contribute to increased SMEs finance, job and wealth creation; and tax-revenue generation.
The beneficiaries of the operation are mainly Fincorp, the target companies operating in sectors such as manufacturing, logistics, forestry, agribusiness and construction in Swaziland. Resources from the government-backed facility will also benefit entrepreneurs with large orders from local and central government and parapublic agencies, while the SME Facility Facility in Africa will be used to benefit Swaziland's SMEs and small rural farmers, with the two handsets making up the majority of Fincorp's portfolio clients.
African Development Bank
|Last Update||07 Aug 2020|
|Name||BANDA Jonathan Richard Kamkosi|