Investing funds in local SMEs - Proposed transaction - African Rivers Fund III
ARF III will provide finance to an estimated number of 40 businesses over the full 10 year term, which will be used for working capital and growth initiatives by the entrepreneurs. Conditions for bank finance in DRC, Uganda and Angola are very strict, allowing ARF III to reach business significantly underserved by local credit markets.
DGGF is one of the first investors committing to the Fund’s First Close, effectively playing a strong cornerstone role and catalysing more investors to help the Fund reach its target size. Furthermore, the fund’s demonstration effect is strong as the spread into Angola provides a chance to demonstrate the viability of investing in a country with significant regulatory hurdles.