Afreximbank Warns of $330 Billion MSME Financing Gap in Africa, Calls for Inclusive Financial Reforms

The African Export–Import Bank (Afreximbank) has sounded the alarm over a staggering $330 billion financing gap facing micro, small, and medium enterprises (MSMEs) across Africa. Despite making up more than 95 per cent of businesses on the continent, most MSMEs remain excluded from formal financial systems, according to Dr. Yemi Kale, Group Chief Economist at Afreximbank.

Speaking at the G-20 SME Finance Forum 2025 in Johannesburg, Dr. Kale called for a bold “re-imagining” of MSME financing to unlock Africa’s entrepreneurial potential. He urged policymakers, financial institutions and entrepreneurs to collaborate in creating a more inclusive and resilient financial architecture that reflects Africa’s 21st-century needs.

Dr. Kale outlined key barriers stifling MSME growth, including lack of reliable information, over-reliance on collateral, inconsistent policies, high capital costs, weak digital infrastructure and persistent skills gaps among entrepreneurs. These challenges, he said, keep many small businesses in the shadows and prevent them from scaling up or competing globally.

Highlighting Afreximbank’s response, he noted that the bank is acting as an ecosystem builder. Through its Fund for Export Development in Africa (FEDA), the bank is providing tailored trade and project financing, equity and venture support, trade facilitation infrastructure, compliance training, and entrepreneurship development — with a special focus on women and youth-led SMEs.

Industry experts say closing Africa’s MSME financing gap could spur job creation, boost intra-African trade and accelerate the continent’s economic diversification. Dr. Kale’s remarks add to growing calls for governments and private-sector players to adopt innovative financial instruments and digital platforms that can widen access to credit for millions of small businesses.

source: The guardian