AfDB Approves 13 Million Euro Line of Credit to Support SME/SMI Development in Niger
The Board of Directors of the African Development Bank (AfDB) has approved today a line of credit of 13 million euros to support small and medium enterprises and industries (SME/SMI) in Niger. The line of credit (LoC) provided to Société Nigérienne des Banques (SONIBANK) will allow to respond to the SME/SMIs’ need of financing in various sectors including agro-food, poultry, construction, public works, trade, transport, educations and health. By guaranteeing access to medium- and long-term credit for these companies the AfDB fosters the Niger private sector sustainable growth and job creation in the country.
SONIBANK, a private-sector bank partly owned by Niger’s parastatal companies, private partners including Société Tunisienne de Banque (STB), as well as the supranational institutions namely the Central Bank of West African States (BCEAO) and the West African Development Bank (WADB), is a leading financial institution in Niger, with about 20 per cent of jobs and resources in the financial sector of the country. It carries out its mission by funding body for individuals and SMEs/SMIs since its inception in 1990.
The granting of the LoC is the AfDB’s second assistance to the private sector in Niger and the first operation in support of a financial institution. Resources from the LoC should allow SONIBANK to strengthen its position as a leader and partner to refinance Niger SME/SMIs in the medium- and long-term resources they are currently lacking, consolidate areas of structural economy that are SMEs, and reinforce its capacity through technical assistance provided by the Fund for African Private Sector Assistance (FAPA), which complements this operation.
The LoC has an excellent demonstration effect because SONIBANK intends to increase its support to companies that will finance the expansion of their activities in a context where access to credit in the medium and long term is difficult. Indicative portfolio of projects includes 12 companies that should receive loans averaging 1 million euro. Support for these businesses, which would create 184 permanent jobs and 503 temporary jobs, will foster poverty alleviation and socio-economic development of Niger.