Afreximbank invests in Republic of the Congo factoring facility
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Loading... - Sophia Afari
- 12 Jun 2023
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The African Export-Import Bank has agreed to provide a €10mn facility to support the expansion of Banque Postale du Congo (BPC), a Congolese lender, in its factoring business for local small and medium enterprises (SMEs).
The agreement, which was signed in late March and announced last week, aims to enable BPC to broaden its factoring activities by engaging in both domestic and cross-border transactions, according to a joint statement issued by the institutions.
In recent years, Afreximbank and BPC have actively contributed to the efforts that led to the Republic of the Congo adopting a model law in 2021, providing legal recognition to factoring as an alternative trade finance method. Following suit, Burkina Faso and Niger have also implemented similar legislation.
Afreximbank, the institution behind the development of the model law on factoring, views this product as a crucial tool for expanding African trade, particularly for SMEs that often face challenges in accessing finance.
The joint efforts of Afreximbank and BPC to promote the model law have played a significant role in highlighting factoring as a viable alternative to trade finance in the Republic of the Congo.
Kayano Awani, the head of Afreximbank's Intra-African Trade Initiative, expresses confidence that this support will empower Banque Postale to strengthen and expand its factoring business, thereby providing much-needed assistance to SMEs in Congo that have limited access to bank financing.
Calixte Tabangoli, CEO of BPC, asserts the bank's determination to maintain its position as the leading provider of factoring services in Congo. He emphasizes their readiness to take factoring in a new direction and hints at the possibility of seeking additional support from Afreximbank in the future.
