AfDB and Mauritius Commercial Bank Partner to Boost African Trade

The agreement brings MCB into the African Development Bank's Trade Finance Transaction Guarantee Instrument as a confirming bank.

The African Development Bank Group has signed an agreement with The Mauritius Commercial Bank Limited to expand trade finance across Africa, giving local banks greater support for cross-border transactions at a time when businesses face a multibillion-dollar shortage in access to trade funding.

The agreement brings MCB into the African Development Bank's Trade Finance Transaction Guarantee Instrument as a confirming bank. Under the arrangement, the Bank Group can provide transaction-by-transaction guarantees covering up to 100% of the non-payment risk taken by MCB on eligible transactions originating from approved African issuing banks.

The structure is designed to give MCB greater confidence to maintain and expand relationships with African financial institutions, particularly in markets where banks have difficulty securing sufficient international credit lines.

Africa Faces Trade Finance Gap of Up to $92 Billion

The scale of the problem remains significant. According to the African Development Bank Group's 2025 Trade Finance Report, unmet demand for trade finance across Africa ranged between $74 billion and $92 billion in 2024.

Small and medium-sized enterprises are among the businesses most affected by this shortage, often facing higher rejection rates when seeking financing needed to import goods, purchase supplies or complete cross-border transactions.

Limited access to trade finance can prevent otherwise viable businesses from accepting orders or reaching customers in new markets, making the availability of banking relationships and payment guarantees an important part of supporting African commerce.

Guarantees Could Give Local Banks Greater Access

The Trade Finance Transaction Guarantee Instrument operates without the Bank Group directly funding each transaction. Instead, the African Development Bank works with African issuing banks and international confirming banks to reduce risks associated with eligible trade deals.

Its AAA-rated guarantee can provide additional protection against non-payment, allowing confirming banks to support transactions they might otherwise consider too risky because of country, institution or market conditions.

African Development Bank Head of Trade Finance Lamin Drammeh described the MCB agreement as a strategic partnership that would allow the institution to use its guarantee strength to give the Mauritian bank confidence to maintain and expand relationships with local African banks.

Drammeh said the arrangement would ultimately benefit SMEs, which play a major role in African economies while facing some of the greatest difficulties securing trade finance.

Partnership Targets Smoother Cross-Border Trade

MCB CEO Thierry Hebraud said joining the programme strengthens the bank's trade finance strategy and increases its capacity to provide solutions to clients and banking partners across the continent.

The partnership is expected to support both intra-African commerce and trade between African businesses and international markets. Greater access to guarantees can help banks process transactions more securely while giving companies the financial backing required to move goods across borders.

For smaller businesses, that support can translate into practical opportunities to buy inputs, fulfil contracts and reach new customers without trade finance becoming an obstacle to growth.

By sharing risk with MCB on approved transactions, the African Development Bank is seeking to unlock more financing through existing banking networks rather than relying solely on direct lending, giving African financial institutions another route to support businesses and keep cross-border trade moving.