The African Export-Import Bank (Afreximbank) has partnered Sterling Bank to introduce an innovative supply chain finance product ‘Payables Finance’, in Nigeria.
This is contained in a statement issued by Vincent Musumba, Manager, Communications and Events, Afreximbank on Friday.
The statement said the product, branded as ‘Afreximbank Tradelink,’ was one of Afreximbank’s digital offerings under the umbrella of the Africa Trade Gateway (ATG).
Under this arrangement, Afreximbank will provide financing to corporates and banks in both US Dollars and Euros while Sterling Bank will manage financing in Naira.
Suppliers of Nigerian corporates can thus benefit from financing in both local and foreign currency as per their requirements.
Musumba said ATG provided African corporates and commercial banks with relevant digital tools to access market information and connect with buyers and sellers across the continent for efficient marketing and procurement.
“It also facilitates Know Your Customer (KYC) processes, and promotes trade payments between African countries in local currencies.”
The statement said ‘Payables Finance’ enabled suppliers to access financing from the banking system by obtaining early payment for invoices that have been approved for payment by their corporate buyers.
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“The buyers continue to receive trade credit from the suppliers, and the suppliers finance their working capital through the early payment received, enabling them to grow their business.
“The financing cost is linked to the credit rating of the corporate buyers, thereby making this product particularly valuable for Small Medium Enterprises suppliers who may face challenges in accessing bank finance at competitive pricing.”
Gwen Mwaba, Director & Global Head Trade Finance, Afreximbank, said “the launch in Nigeria is a first step in Afreximbank’s plans to introduce ‘Payables Finance’ across Africa in partnership with leading African financial institutions.
“The product will deploy world-class technology and a collaborative delivery model,” he said.
Chukwuka Onuaguluchi, Ecosystem Banking Head, Sterling Bank, said “Sterling Bank is committed to meeting the trade finance needs of Nigerian corporates and their suppliers.
“We are proud to introduce this much-needed product in partnership with Afreximbank for the benefit of Nigerian businesses,” he said.
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