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KfW and Verdant Capital raise USD 36 mln fund for African SMEs

Friday 14 January 2022 13:53 CET | News

KfW and Verdant Capital have established a new fund worth USD 36 million to support micro, small and medium-sized enterprises (MSMEs) growth in Africa.

Verdant Capital Hybrid Fund (VCHF) has reached its first closing with committed capital of USD 36 million. The fund is targeting high developmental impact, including job creation and income generation through SMEs and micro-entrepreneurship. The fund will be investing hybrid capital and subordinated debt instruments into inclusive financial institutions on a pan-African basis.

The fund will target specialist banks, microfinance institutions, leasing, and factoring companies, fintech and other non-bank financial institutions. A strong focus will be to ensure that the investments comply with high environmental and social standards. The fund is targeting two further closings with a targeted final close amount of USD 100 million.

KfW Development Bank, on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), is contributing about USD 34 million to the VCHF. Beside KfW, the fund is benefitting from capital commitments of private investors including the fund manager of VCHF, Verdant Capital.

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Keywords: SME lending, investment, financial institutions, banks
Categories: Banking & Fintech
Companies: KfW, Verdant Capital
Countries: Africa
This article is part of category

Banking & Fintech

KfW

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Verdant Capital

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