Banking institutions pledge assistance to the small and medium enterprise (SME) sector, as endorsed by the National AfCFTA coordinating office.

Banking institutions pledge assistance to the small and medium enterprise (SME) sector, as endorsed by the National AfCFTA coordinating office.

The National AfCFTA Coordinating Office in Ghana has urged local banks to strengthen their financial support for small and medium enterprises (SMEs) seeking to participate in the single continental market.

Speaking to the Single African Market, Catherine Afeku, the Head of Strategic Communications at the office, emphasized the critical role banks must play in lifting SMEs to sizeable trading entities. "By boosting their financing to this vital sector of the economy, we can nurture trade champions," Afeku stated.

To expand their financing capabilities, Afeku suggested that banks work collaboratively with sister banks across the continent, securing guarantees that enable them to fund intra-African trade. Regarding compliance, she underscored the need for banks to view the situation from a novel perspective, emphasizing the necessity to meet the demands posed by the AfCFTA while staying compliant with its rules.

According to Afeku, the AfCFTA has now firmly taken root, and the office has been focusing on repositioning Ghanaian businesses for the single continental market during the past several months. One such initiative, she explained, is conducting assessments on companies to gauge their export readiness and offering necessary support to facilitate their initial shipments — particularly for businesses that are new to exporting.

Additionally, Afeku pointed out that the office has established a team of expanded inspection officers, combining resources from key stakeholders such as GRA Customs and the Ministry of Trade, to ensure appropriate certifications before issued to businesses intending to export under the AfCFTA.

Although the National AfCFTA Coordinating Office has yet to reveal specific strategies or requirements for banks to facilitate SME financing within the AfCFTA context, an analysis of stakeholders' statements, UNDP initiatives, and relevant regional body recommendations suggests some key requirements and strategies. These include regulatory alignment, digitalization and innovation in financial services, improved access to trade finance, and capacity building and risk mitigation.

Banks should, among other steps, ensure that their operations align with AfCFTA and sub-regional rules, invest in digital platforms, collaborate on digital payment infrastructure, develop innovative finance products for SMEs, integrate risk-sharing mechanisms, and build expertise to navigate the evolving trade landscape, among other measures.

Collaborative initiatives, the promotion of digital financial integration, actionable and measurable steps, and support for SME ecosystem development are also strategic priorities emphasized by relevant stakeholders. By adopting these recommendations, banks can better position themselves to support SMEs within the AfCFTA single continental market.

1. Banks, as urged by the National AfCFTA Coordinating Office, should collaborate with sister banks to enhance their financing capabilities for small and medium enterprises (SMEs) participating in the AfCFTA market.
2. To boost SMEs to sizeable trading entities within the AfCFTA single continental market, banks should consider digitizing their platforms and developing innovative finance products.
3. The National AfCFTA Coordinating Office, in its effort to reposition Ghanaian businesses for the AfCFTA market, has been conducting assessments on companies to gauge their export readiness and offer necessary support.
4. To nurture trade champions and ensure appropriate certifications for businesses intending to export under the AfCFTA, the National AfCFTA Coordinating Office has established a team of expanded inspection officers, combining resources from key stakeholders.

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