Afreximbank has called on African countries to significantly scale up factoring and supply chain finance (SCF) to support Small and Medium Enterprises (SMEs) and unlock the continent’s economic potential.
Speaking at Afreximbank’s annual Factoring Workshop in Abidjan, Mrs. Kanayo Awani, Executive Vice President for Intra-African Trade and Export Development, highlighted that while Africa’s factoring volumes have more than doubled from €21.6 billion in 2017 to €50 billion in 2024, activity remains far below what is needed to transform the continent.
“SMEs account for over 90% of Africa’s businesses and contribute more than 60% of employment and GDP, yet they face a financing gap estimated at US$300 billion annually,” Mrs. Awani said. “To catalyse SME-led growth, Africa must scale factoring volumes to at least €240 billion, roughly 10% of the continent’s GDP.”
She emphasized that achieving this goal will require deeper legal reforms, increased financing, expanded training, and strong industry partnerships.
Mr. Neal Harm, Secretary General of FCI, added that factoring and SCF are essential tools to improve cash flow and accelerate SME growth, while Mr. Charlie Dingui, Special Advisor to the BCEAO National Director, underscored their role in driving socio-economic development across UEMOA member states.
Côte d’Ivoire, in particular, presents a significant opportunity to expand factoring, with the sector estimated to have a US$5 billion potential. Yet, only 12% of SMEs currently access formal working capital, often relying on informal sources due to high financing costs, perceived risks, and slow loan approval processes.
The workshop is part of Afreximbank and FCI’s ongoing efforts to strengthen technical expertise and awareness on factoring and SCF, crucial for advancing the African Continental Free Trade Area (AfCFTA). To date, over 5,000 delegates have benefited from capacity-building programs including COTFIA, AFRACAD, and FCI’s training and mentoring initiatives.
