Search

Equity Guarantee

Product Description

This is a guarantee that covers initial capital investment loss for investors providing equity or quasi equity to Small and Medium-sized Enterprises.

The Equity Guarantee (EG) provide an alternative source of financing to SMEs facing difficulties in accessing Bank financing due to their weak financial structure.

Key Features

  • Coverage: 50%
  • USD 1,000,000 (Depending on the tiering of the financial institution)

Benefits

  • Enables PFIs scale-up equity capital financing of SMEs with promising outlook, but relatively weak financial structures as well as those in the  seed and start-up phase, mezzanine financing and risk capital operations;

Through the Capacity Development component of the EG

  • Develops and strengthens the skills, management practices, strategies, systems, competencies and abilities of PFIs to effectively increase their SME financing business;
  • Assists SMEs enhance their business managerial capabilities especially in areas which include among others, governance, human capital management, quality control, packaging, financial management, and marketing

Eligibility Criteria

  • The request must be from Private Equity Funds or Venture Capitals targeting SMEs
  • The target of the Equity Guarantee cuts across all sectors with an exception of those listed in AGF’s exclusion list.

other products

African Guarantee Fund contributes to the promotion of economic development in Africa through provision of Partial Guarantees & Capacity Development to Financial Institutions to facilitate access to finance for Small and Medium-sized Enterprises.