The African Development Bank has signed a confirmation agreement with Ghana International Bank under its Transaction Guarantee facility to support trade finance across Africa. The agreement expands the AfDB’s network of financial partners working to reduce the continent’s annual trade finance gap, which is estimated at between USD 100 billion and USD 120 billion.
The partnership gives Ghana International Bank a formal role in confirming trade transactions issued by African local banks, especially in markets where major international correspondent banks have reduced their presence. These underserved markets include Sierra Leone, The Gambia, Guinea and Liberia.
AfDB’s Transaction Guarantee instrument was launched in 2021 as an unfunded, non-cash risk-sharing mechanism. It can cover up to 100 percent of non-payment risk faced by international confirming banks on letters of credit issued by African local banks.
The facility is designed to help local banks support importers and exporters by improving access to internationally accepted confirmation lines. This is especially important in frontier markets where global banks have withdrawn because of risk, compliance costs and profitability concerns.
The AfDB did not disclose the size of the guarantee facility allocated to Ghana International Bank. However, the bank’s wider Trade Finance Program has supported more than USD 13.8 billion in trade flows since 2013 through 129 partner financial institutions.
The agreement comes at a time when African countries are seeking to accelerate implementation of the African Continental Free Trade Area. Limited access to trade finance remains a major constraint on intra-African trade, especially for smaller economies and businesses operating in higher-risk markets.
AfDB Vice President for the Private Sector Solomon Quaynor said the partnership will support low-income African markets and aligns with the Bank’s regional integration mandate. Ghana International Bank’s ability to confirm transactions from local banks can help improve cross-border trade flows and strengthen connections between African markets and international capital.
Ghana International Bank operates from London under United Kingdom regulation and remains owned by Ghanaian shareholders. The bank generates most of its business from trade finance activities, positioning it as an important bridge between African financial institutions and global trade networks.
Overall, the AfDB-GHIB agreement represents another step toward expanding access to trade finance in underserved African markets. By reducing risk for confirming banks and supporting letters of credit from local banks, the partnership can help businesses trade more confidently, strengthen regional integration and support Africa’s broader economic growth.
