AU launched the African Smart Finance-Digital Banking Initiative to be in the global digital Market
African Union facilitate it and launched the African Smart Finance and Digital Banking Initiative. It aims at supporting the African SMEs, women and youth to realize financial self-sustainability, build market and investor confidence, and ultimately accelerate the continent’s economic growth.
This system calls for a shift in the mindsets of SMEs, bankers, development finance institutions, angel investors, and the venture capital players, in a strategy that supports a high tolerance for risk with a huge appetite for patient capital which allows SMEs to venture into profitable business enterprises.
The Digital innovation has been created to deliver loans to millions of people in different countries at low interest, accelerated cycle of service delivery such as the reduction of loan cycle from 3 months to 3 days, and a reduction of risk due to the affordability of cost of finance. The multiplier factor will be a key lever to uplift Africans out of poverty and expand investments opportunities.
The unveiling of the strategic initiative will deliver on one of the critical issues identified by SMEs, women and youth entrepreneurs — namely lack of access to affordable finance. For instance, in 2017, the AU Commission began the preparation of an SME Strategy, as a framework to support AU member States that have themselves prioritized SME development.
Following the operationalization of the Sokokuu, Africa Pan African Ecommerce Platform, the Smart Finance and Digital Banking Initiative for SMEs, Women and Youth seeks to present an integrated solution to drive job creation across the continent in the Post-COVID-19 era.