BII commits $65m to banks in Zambia and Zimbabwe

British International Investment (BII) has committed $65 million to financial institutions in Zambia and Zimbabwe, with the money earmarked for business lending, agriculture, renewable energy and other projects. The commitments were announced on 29 September as BII set out a new five year strategy for Zambia. 

In Zambia, $15 million will go to Zanaco as an anchor investment in the bank's $100 million sustainability bond programme. In Zimbabwe, BII is committing $30 million to CABS and $20 million to NMB Bank under its agriculture finance programme.

Zanaco plans $100m sustainability bond

Zanaco's programme is expected to begin with a $50 million bond. BII's $15 million will form part of that first issue. The bank will then raise the remaining capital from other investors. The programme covers several types of financing, including small and medium-sized businesses, women-owned businesses, renewable energy and climate-resilient agriculture. Social infrastructure is also included.

 BII expects investors outside the development-finance sector to provide about 40% of the capital. That gives Zanaco a larger pool of funding to deploy through its lending business rather than relying only on BII's investment.

Zimbabwe deal goes into agriculture

The Zimbabwe funding is aimed specifically at agricultural finance. CABS will receive $30 million, while NMB Bank will receive $20 million. The facilities will support companies across agriculture and food production, including businesses that need finance for equipment, working capital and trade. 

For exporters, access to trade finance can help cover costs between placing an order and getting paid by a customer. The two banks already operate in Zimbabwe's agricultural market, so the funding will be deployed through their existing lending operations.

BII wants more private capital involved

The Zambia transaction is also part of BII's wider effort to get commercial investors involved in financing businesses and infrastructure. The institution says it expects about 40% of the capital in the Zanaco programme to come from investors outside development finance. 

BII has been working with Zanaco since 2023 on sustainable finance, including helping the bank develop the framework it will use for the bond programme. The organisation is also supporting businesses through its Horizon Zambia programme, which focuses on helping companies prepare for investment.

For businesses, however, the immediate issue is simpler. The money still has to make its way through the banks. An SME looking for finance will still need to meet the bank's lending requirements. An agricultural company seeking working capital will still need to show that it can repay the facility. So the $65 million announcement is the starting point rather than the end result. The useful numbers will come later: how much the banks lend, how many businesses receive the money and what sectors take up the funding.