Africa Finance Corporation (AFC) has partnered with Munich Re to launch a US$1 billion Unfunded Managed Debt Mobilisation Programme (UMDMP). This initiative aims to enhance trade finance for African banks at a time when they require substantial liquidity for intra-African and international trade.
The UMDMP will provide fast-tracked trade finance, with Munich Re agreeing to risk parameters that simplify the approval of eligible transactions. AFC will retain part of the risk, ensuring both organisations’ interests remain aligned. As transactions mature, their capacity will be recycled to fund new investments.
Initially, the programme will focus on commercial letters of credit, trade loans, and guarantees, supporting 38 financial institutions across 11 African nations. The scope may expand to include additional instruments and sectors in the future.
Banji Fehintola from AFC noted that traditional lending cannot fully meet Africa’s financing needs. He highlighted that the UMDMP allows AFC to leverage its expertise and attract institutional capital effectively. He also stated that as the African Continental Free Trade Area strengthens trade, this programme addresses banks’ capacity constraints.
Wola Asase from AFC added that the arrangement with Munich Re will expedite decision-making for trade finance transactions and facilitate the introduction of more institutional investors. Herbert Müller from Munich Re emphasised the longstanding partnership with AFC, which has switched to a programme-based approach for efficient support to African financial institutions.
This UMDMP builds on a collaboration that began in 2018, during which Munich Re shared risk on AFC loans transaction by transaction. The programme represents a significant step in enhancing the financial tools available to African businesses, driving growth and job creation through increased funding.
Through the establishment of AFC Captive Insurance Company in August 2026, AFC aims to manage its risk more effectively while extending its financing ability. The new initiatives signify AFC’s commitment to rely on insurance and risk-sharing for sustainable infrastructure investment across Africa.
Founded in 2007, AFC has invested over US$19 billion in infrastructure projects across 36 African countries, focusing on driving economic growth and providing essential services.
