The African Development Bank has approved a $60 million (Sh7.7 billion) Trade Finance Transaction Guarantee facility for Equity Bank Kenya, a move expected to ease access to trade finance for small and medium-sized enterprises and local corporates.
The facility, approved by the Bank’s Board of Directors, will allow Equity Bank (Kenya) Limited to issue guarantees of up to 100 percent to confirming banks, covering non-payment risks linked to Letters of Credit and similar trade finance instruments.
This support is aimed at strengthening import trade and enabling Kenyan businesses to transact more securely with international partners.
Many SMEs and local firms in Kenya continue to face difficulties accessing affordable trade finance, a challenge that often limits their ability to import essential inputs and expand operations. By reducing risk for confirming banks, the guarantee is expected to unlock much-needed financing and give businesses greater confidence to engage in cross-border trade.
The initiative is also aligned with the African Continental Free Trade Area agenda, with the African Development Bank noting that improved access to trade finance is key to boosting intra-African trade and accelerating regional integration.
Commenting on the approval, African Development Bank Trade Finance Division Manager Lamin Drammeh said promoting trade across the continent remains a top priority for the institution.
“Trade finance is essential for Africa’s economic development, facilitating both domestic and international trade, boosting economic growth, and promoting regional integration,” he said.
He added that the Bank was “delighted to work with Equity Bank, a strong partner with extensive knowledge and network in the country, on a shared ambition of supporting the region’s trade.”
Equity Bank (Kenya) Limited Managing Director Moses Nyabanda said the facility comes at a critical time for Kenyan businesses, particularly SMEs that continue to struggle with limited access to affordable financing.
“The African Development Bank’s support strengthens Equity Bank’s capacity to unlock growth opportunities for local enterprises by enhancing their ability to trade with confidence, manage risk, and sustain their operations,” Nyabanda said.
He added that the guarantee will enable the bank to expand access to key trade finance instruments, allowing importers to transact “smoothly and securely,” and supporting business continuity and growth.
The partnership highlights the growing role of development finance institutions in supporting private sector-led growth and strengthening Africa’s trade ecosystem, with Kenya positioned as a key beneficiary.
