• TradeConnect offers guarantees for small international trade deals

• First agreement signed with Access Bank to share loan risk

• Tool aims to ease financing constraints for importers and exporters

Germany’s development bank DEG has introduced a new trade guarantee tool called TradeConnect, designed to secure small international transactions between German companies and partners in developing and emerging markets.

The first agreement was signed on December 2 with Nigeria’s Access Bank. The facility will cover part of the risk taken by local banks when they finance small import-export deals.

A tool to fill a financing gap

In many developing countries, local banks do not lend for small import-export operations. This gap slows commercial transactions, limits the ability of German small and medium-size firms to buy and sell, and prevents local companies from obtaining credit to import goods from Germany or export to the German market.

To help address this, DEG will guarantee up to €5 million, or as much as 50 % of the loan extended by Access Bank for small trade operations. With this backing, banks can more easily support deals that previously stalled for lack of financing.

A targeted expansion of DEG’s services

TradeConnect is part of DEG’s effort to strengthen business ties between Germany and developing countries, reduce banking risks for small transactions, and support broader economic cooperation. The instrument adds to the bank’s existing services, including long-term industrial financing, its ImpactConnect program for small investments, German Desks that assist firms facing financial or language barriers, and advisory services from DEG Impulse on climate and sustainability.

Chamberline Moko