JOHANNESBURG, South Africa (XOL Africa) — The African Development Bank Group has invested $332 million (ZAR 5.4 billion) in a capital markets security issued by Standard Bank Group to expand financing for small and medium-sized enterprises (SMEs) across South Africa.
The transaction, announced on July 31, 2026, marks the first development finance institution (DFI)-supported social FLAC (Foreign Loss Absorbing Capacity) instrument listed on the Johannesburg Stock Exchange (JSE), according to the African Development Bank.
The facility is designed to strengthen Standard Bank Group’s capacity to provide long-term financing to SMEs, which play a critical role in job creation and economic growth in South Africa.
In addition to the investment, the African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA) programme is providing a $1 million (ZAR 16 million) technical assistance grant through the Women Entrepreneurs Finance Initiative (We-Fi) window.
The grant will support initiatives aimed at reducing barriers faced by women entrepreneurs, including access to digital payment tools to help businesses build verifiable credit histories and enterprise and supplier development support for women-led SMEs.
The FLAC instrument, introduced by the South African Reserve Bank in January 2026 as part of the country’s phased implementation of a bank resolution framework, has been issued as a social bond on the Johannesburg Stock Exchange.
The African Development Bank said the transaction represents Standard Bank Group’s first FLAC issuance on the exchange dedicated to social impact financing.
“This investment reflects the African Development Bank’s commitment to strengthening Africa’s financial architecture while directing long-term capital to where it is needed most — South Africa’s small businesses and entrepreneurs,” said Kennedy Mbekeani, the Bank’s Director General for Southern Africa and Country Manager for South Africa.
“By partnering with Standard Bank Group, we are simultaneously helping to build a more resilient banking system and supporting the SMEs that drive jobs and inclusive growth,” he added.
Standard Bank Group has committed to allocating the full ZAR 5.4 billion facility to SMEs, including women-owned businesses, in recognition of the financing challenges faced by small enterprises.
Luvuyo Masinda, Chief Executive of Corporate and Investment Banking at Standard Bank Group, said the partnership would help expand support for businesses that contribute significantly to South Africa’s economy.
“We are delighted to close another landmark transaction with the AfDB, following the successful 2024 transactions,” Masinda said.
“SMEs are a critical driver of economic growth and job creation. They are the backbone of South Africa’s economy, with approximately 3.2 million SMEs accounting for 60% of jobs, so ensuring these businesses have support and access to finance is imperative to our collective growth aspirations,” he added.
Bill Blackie, Chief Executive of Business and Commercial Banking at Standard Bank, said the transaction would strengthen the bank’s ability to support businesses that drive inclusive economic growth.
“The technical assistance grant will allow us to fund key initiatives that deliver direct, tangible benefits to women-led SMEs, supporting their ambitions to start, manage and grow resilient businesses,” Blackie said.
Ahmed Attout, Director of the Financial Sector Development Department at the African Development Bank, described the transaction as a catalyst for strengthening banking practices across Africa.
“This transaction is designed to be catalytic, encouraging the broader adoption of international best practice in banking across the African continent,” Attout said.
The deal builds on a long-standing partnership between the African Development Bank and Standard Bank Group dating back to 2008.
It follows the Bank’s approval in November 2024 of a ZAR 3.6 billion subordinated debt facility for Standard Bank Group and a $200 million risk participation agreement with The Standard Bank of South Africa to support trade finance across the continent.
The African Development Bank said the previous facility had already delivered significant results. As of December 2025, Standard Bank Group had fully utilised the 2024 financing, supporting 5,425 SMEs and exceeding its initial target of 4,000 businesses.
The loans supported enterprises operating in key sectors including agriculture, retail, wholesale trade and manufacturing.
