BancABC Botswana secures P400m funding

BancABC Botswana this week secured a $40 million (about P400 million) debt facility to speed up digital finance services as well as expand funding to small businesses.

Sourced from USA’s Overseas Private Investment Corporation (OPIC), the loan was arranged by BancABC parent company, Atlas Mara.

The funding is part of the $200 million multi-country facility that OPIC approved for Atlas Mara’s banks in Botswana, Zambia and Mozambique in August 2015.

“The OPIC facility underscores our commitment to working with DFIs on financial development and access to finance for SMEs and individuals in Africa and reflects our multifaceted strategic engagement with DFIs.

As we indicated with our third quarter results, we are increasingly focused on organic growth, scaling up our banking operations, and delivering accelerated growth in key areas of our operations. As a top tier bank in Botswana, we are excited to have the support and funding of OPIC to drive financial inclusion and support our growth ambitions,” said Atlas Mara chairman, Bob Diamond.

Atlas Mara has a focus on profit with purpose in financial services in sub-Saharan Africa and it has prioritised working with OPIC and other Development Finance Institutions (DFIs) in the US, Europe, and Africa.

According to Diamond, the debt facility will be used to provide access to finance for SMEs and to support the company’s efforts to accelerate its digital finance initiatives, which are key areas of the company’s strategy.

It is consistent with Atlas Mara’s objective of supporting financial inclusion and will allow the company to expand access to finance in underserved markets, he said.

Under the terms of the agreement, OPIC will provide $200 million in long-term debt and Atlas Mara will provide $100 million of committed resources, to expand the operations of Atlas Mara’s Southern African banking platform, BancABC.

BancABC will scale up its SME loan portfolio, increase on-lending for financial inclusion products, and invest in information technology upgrades to quicken implementation of its new financial technology and mobile banking initiatives, Atlas Mara said.

Furthermore, $130 million of OPIC’s $200 million debt under this project will be dedicated towards financing strategic acquisitions to facilitate expansion of Atlas Mara’s platform, footprint, and channels bolstering its developmental impact reach.

OPIC is a US Government’s development finance institution.

Last year, Barclays Bank Botswana secured a $125 million credit agreement from OPIC to finance local diamond manufacturers. Source: Mmegi

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