IFC to support East African Bank with trade finance guarantee

Wednesday 23 June 2021 13:42 CET | News

IFC has announced a trade finance guarantee facility for Djibouti-based East African Bank (EAB) to help local companies engage in cross-border trade.

IFC’s trade finance facility guarantee of up to USD 5 million under its Global Trade Finance Program (GTFP) will help EAB provide financing to importers and exporters in Djibouti, supporting the local economy and helping maintain the flow of essential goods into the country, including medical equipment and commodities.

IFC’s support to EAB is underpinned by the International Development Association’s Private Sector Window (IDA PSW), which is providing first-lost guarantees and limit enhancements to the GTFP in low-income countries.

The facility announced today follows an advisory services agreement signed in April 2021 between IFC and EAB that is helping strengthen EAB’s risk, trade, and credit management framework and capacities in line with international best practices.

Through IFC’s GTFP bank network, local financial institutions can establish partnerships with major international banks to broaden access to finance and reduce cash collateral requirements. This enables the continued flow of trade credit into the market when imports may be critical, and the country’s exports can generate much-needed foreign exchange.

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Keywords: partnership, funding, trade finance, supply chain finance
Categories: Banking & Fintech
Countries: Djibouti
This article is part of category

Banking & Fintech