In a trade report released by Afreximbank on 24 June 2026, the bank identified a $120 billion trade finance deficit — a lack of loans to support business across Africa. This funding shortfall restricts commerce and growth under the AfCFTA. In response to the identified gap, global organisations such as the EBRD issued a $100 million investment for trade finance facilitation to Access Bank in January 2026.

Key Drivers and Impact on SMEs

The gap, according to Afreximbank, is driven by the limited risk-bearing capacity of domestic banks and high transaction costs. SMEs face the tightest credit constraints because local banks view them as riskier ventures. These banks prefer to lend to larger businesses. As the report highlights, African banks often shy away from financing retail customers operating SMEs, even though these businesses account for the largest share of deposits. Consequently, SMEs across Africa face the most severe credit constraints. For exporters shipping goods to other African countries, AfCFTA tariff reductions help to some extent, but goods often remain stuck in ports because traders cannot access the funding needed to move them.

Strategic Responses and Digital Innovations

In response, Afreximbank plans to double its intra-African trade finance allocation and develop frameworks that reduce reliance on foreign currencies such as the USD for regional settlements. The bank is also funding digital factoring platforms like Capsa — a digital marketplace for unpaid invoices from large corporations, which often take 90 days or more to settle due to internal bureaucracy. These solutions unlock stuck working capital, enabling small suppliers to continue operating without disruption.

Conclusion

Over the years, Africa’s financial gap has continued to widen due to high default rates and the resulting reluctance of financial institutions to lend to small businesses. While this gap poses challenges, it also creates opportunities for lending to promising SMEs in sub-Saharan Africa and for serious entrepreneurs looking to build and scale businesses across the continent.