Online Reporter
Kudzanai Sharara in Algiers, Algeria
CBZ Bank has signed a US$10 million factoring and supply chain finance line of credit from the African Export and Import Bank (Afreximbabnk), which bank officials say will transform the country’s financial landscape for small and medium-sized enterprises (SMEs).
The deal was signed during the Intra-African Trade Fair underway here. It becomes the second deal the bank has signed at IATF2025, a continental showcase where deals worth US$44 billion are expected to be sealed.
According to CBZ Bank’s newly appointed managing director, Mrs Valeta Mthimkhulu, the facility, a partnership with Afreximbank, marks a pivotal moment as CBZ becomes the first commercial bank in Zimbabwe to offer this form of financing.
Factoring in banking is a financial arrangement where a business sells its unpaid invoices (accounts receivable) to a specialised third-party, known as a factor, at a discount to receive immediate cash. This process improves the business’s cash flow by providing working capital without incurring debt, as the factor advances a percentage of the invoice value and then collects the full payment from the business’s customers, charging a fee for the service.
“It is an honour and a privilege today as we mark the transformative milestone of signing, on behalf of CBZ Bank Limited, the US$10 million factoring and supply chain finance line of credit,” said Mrs Mthimukulu.
She emphasised the importance of this milestone, highlighting that factoring makes it easier for SMEs to access various forms of open account financing and is a crucial driver of financial inclusion.
“The role that factoring plays as a mode of finance is that it does make it easier for SMEs to really access, you know, different forms of open account financing and also is an important driver of financial inclusion,” she explained.
“And therefore, that is why we’re really excited to be bringing this facility and signing this facility on behalf of our clients in Zimbabwe.”
In addition to the new line of credit, Mrs Mthimkhulu announced that CBZ Bank has also been onboarded onto the Africa Trade Gateway, a visionary initiative by Afreximbank in collaboration with the African Union.
She believes that these two developments together will significantly benefit the country’s business sector.
“We do believe that these milestones together will make financing more accessible to SMEs in Zimbabwe, drive financial growth, and also help to take out some of the costs that have been preventing some of our SMEs from thriving,” she stated.
“It really is an exciting milestone for us. And we do believe that this is the first step that will move Zimbabwe forward in terms of making financing accessible to our SMEs as we continue to drive financial inclusion.”
CBZ Holdings chief executive officer, Mr Lawrence Nyazema, recently spoke about the factoring facility.
“We want to normalise the way financial transactions are done once again. There has not been real factoring business since the days of the likes of UDC,” said Mr Nyazema.
Mrs Mthimkhulu signed on behalf of CBZ, while Kanayo Awani, executive vice president of Afreximbank, signed on behalf of her organisation.
