Seen Here: Strengthening South Africa’s SME economy through strategic partnership. From left: Bill Blackie, Chief Executive of Business and Commercial Banking at Standard Bank Group; Kennedy Mbekeani, African Development Bank Director General for Southern Africa and Country Manager for South Africa; and Luvuyo Masinda, Chief Executive of Corporate and Investment Banking at Standard Bank Group, following the announcement of a landmark USD 332 million (R5.4 billion) financing agreement aimed at expanding access to funding for small and medium-sized enterprises, with a strong focus on women-led businesses and inclusive economic growth. Photo Credit: Supplied
JOHANNESBURG – In a landmark move set to strengthen South Africa’s small business sector, the African Development Bank (AfDB) and Standard Bank Group have concluded a USD 332 million (approximately R5.4 billion) financing agreement aimed at expanding access to capital for small and medium-sized enterprises (SMEs), with a strong focus on supporting women-led businesses and driving inclusive economic growth.
The transaction also marks a significant milestone for South Africa’s financial markets, becoming Africa’s first Development Finance Institution (DFI)-supported social Flac instrument listed on the Johannesburg Stock Exchange (JSE).
A Major Boost for Small Business
SMEs remain the backbone of South Africa’s economy, contributing significantly to employment, entrepreneurship and economic resilience. Recognising their importance, Standard Bank has committed to directing the entire R5.4 billion raised through the transaction towards financing SMEs across the country.
The initiative is expected to improve access to funding for thousands of businesses operating in key sectors including agriculture, manufacturing, retail and wholesale trade, while also addressing the persistent financing challenges facing women entrepreneurs.
Complementing the financing facility, the African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA) programme has committed a USD 1 million (approximately R16 million) technical assistance grant through the Women Entrepreneurs Finance Initiative (We-Fi).
The grant will support digital payment solutions that help women-owned businesses establish credible financial records while also funding enterprise development and supplier support programmes designed to strengthen business sustainability and growth.
Strengthening South Africa’s Financial System
The investment has been structured as a Flac (First Loss After Capital) instrument, a new debt category introduced by the South African Reserve Bank in January 2026 as part of the country’s evolving banking resolution framework.
Issued as a social bond and listed on the Johannesburg Stock Exchange, the instrument represents an innovative financing mechanism designed to strengthen banking sector resilience while ensuring that capital reaches businesses capable of creating jobs and stimulating economic activity.
African Development Bank Director General for Southern Africa and Country Manager for South Africa, Kennedy Mbekeani, described the investment as a strategic intervention that delivers both financial stability and economic inclusion.
“This investment reflects the African Development Bank’s commitment to strengthening Africa’s financial architecture while directing long-term capital to where it is needed most—South Africa’s small businesses and entrepreneurs. By partnering with Standard Bank Group, we are simultaneously helping to build a more resilient banking system and supporting the SMEs that drive jobs and inclusive growth.”
Investing in Inclusive Growth
Standard Bank says the partnership reinforces its long-standing commitment to supporting entrepreneurship and sustainable economic development across the continent.
Chief Executive of Corporate and Investment Banking at Standard Bank Group, Luvuyo Masinda, said the agreement builds on the bank’s successful collaboration with the African Development Bank.
“This social Flac issuance will further enable the Group to deliver on our purpose—’Africa is our home; we drive her growth.’ SMEs are a critical driver of economic growth and job creation. They are the backbone of South Africa’s economy, with approximately 3.2 million SMEs accounting for 60% of jobs, making access to finance essential for our collective growth aspirations.”
Chief Executive of Business and Commercial Banking at Standard Bank, Bill Blackie, highlighted the significance of the technical assistance programme, particularly for women entrepreneurs.
“We see first-hand the critical role that SMEs play in driving prosperity and job creation. This partnership strengthens our ability to support businesses that underpin inclusive economic growth while enabling targeted initiatives that deliver tangible benefits to women-led enterprises.”
Building on a Strong Partnership
The latest agreement strengthens a partnership between the African Development Bank and Standard Bank that spans nearly two decades.
It follows the Bank’s approval in 2024 of a R3.6 billion subordinated debt facility for Standard Bank Group together with a USD 200 million risk participation agreement supporting trade finance across Africa.
The success of that partnership has already demonstrated measurable impact. By December 2025, Standard Bank had fully deployed the previous facility, financing 5,425 SMEs, surpassing its original target of 4,000 businesses.
Funding supported enterprises across agriculture, manufacturing, retail and wholesale sectors, reinforcing the role of SME finance in driving employment and economic resilience.
Catalysing Africa’s Financial Future
African Development Bank Director of the Financial Sector Development Department, Ahmed Attout, believes the transaction will serve as a model for future financial innovation across the continent.
By combining innovative capital market instruments with targeted support for entrepreneurs, the partnership aims to encourage broader adoption of international best practice while strengthening Africa’s banking sector and unlocking greater opportunities for business growth.
As South Africa continues to pursue inclusive economic development, the landmark R5.4 billion investment represents more than just a financing transaction—it is a strategic investment in entrepreneurship, job creation, women’s economic empowerment and the long-term resilience of one of Africa’s most important economies.
