Easing int’l transactions: Afriland First Bank gets additional 3 billion FCFA to support enterprises.

The development was made public in Douala July 9, 2024. This was during a ceremony to sign the agreement to renew the partnership between both institutions, under the Trade Finance transaction guarantee program.

The program, it should be said, enables Afriland First Bank to issue international trade finance instruments.

The partnership, which was renewed in Douala, was initially signed in 2022, making available 15 million euros, estimated at about 10 billion FCFA, for the transaction.

The additional three billion FCFA (5 million euros), officials disclosed during the renewal of the partnership, will help Afriland First Bank broaden its scope of intervention in trade finance operations. 

Renewal good news for companies, SMEs

Speaking after the ceremony, the Deputy General Manager of Afriland First Bank, Youssoufa Bouba, described the signing of the renewal agreement as an “excellent news for companies, and for our customers”.

“The line was 15 million euros, now it's 20 million euros. This broadens our horizons and our capacity to intervene,” Youssoufa said.

The Deputy General Manager said the agreement further reinforces Afriland First Bank’s existing support system for Small and Medium Sized Enterprises, SMEs. 

“It is important to note that SMEs are at the forefront of our policy. They are the foundation of any ambitious economy. For SMEs, this will give them access to financing, particularly internationally. It will enable them to acquire raw materials and important equipment for their production, marketing and distribution of their activities. So, it's a plus that we have among the many elements at our disposal to support SMEs," Youssoufa added. 

Growing demand from SMEs 

The extension of the guarantee line, it should be said, comes in response to growing demand from SMEs in Cameroon. 

The Trade Finance guarantee program, PROPARCO’s Regional Director for Central Africa, Mehdi Tanani, explained, "makes it easier for companies to trade”. 

"When a company wants to buy equipment or fertilisers, it must issue a documentary credit, through its local bank. This must be counter-guaranteed by the exporter's bank, from which the equipment is purchased. Today, however, international banks are increasingly reducing their exposure to the African continent, through their prudential and regulatory systems. Trade Finance is a tool that can be used to open up banks' liquid assets. And for the banks of importing companies, such as Afriland First Bank, it gives them more leeway to support their customers and their corporates here in Cameroon, and thus facilitates the creation of value by these companies", Mehdi Tanani stated.

This story was first published in The Guardian Post issue No:3165 of Thursday July 10, 2024