Mozambique’s Sociedade de Garantias de Moçambique (SGM) is negotiating new sources of financing to strengthen its Mutual Guarantee Fund, with the aim of broadening credit access for micro, small and medium-sized enterprises (MSMEs), the institution’s president, Beatriz Freitas, told Lusa.
In an interview with Lusa in Maputo, Freitas explained that the number of partners in the fund is growing, even though the mechanism currently operates exclusively with financial institutions. She expects to mobilise new resources within approximately one year.
“I think that within a year we should have additional financing for the fund, or to create a new fund,” Beatriz Freitas said, noting that negotiation processes are lengthy and that their conclusion depends on how discussions evolve over the coming months.
The Mutual Guarantee Fund has been operational since 2025 and is implemented by Banco Comercial e de Investimentos (BCI), Standard Bank, and Absa Bank, with financing from the World Bank, which provided US$120 million.
The mechanism aims to facilitate financing access for 15,000 domestic companies and to contribute to the creation of more than 20,000 jobs. Since operations began, approximately 630 companies have benefited from guarantees, with no recorded defaults that have required the institution to call on any guarantee.
According to Freitas, the institution has already received expressions of interest from other entities, including donors and financiers, seeking to support guarantee mechanisms in Mozambique.
Provincial Expansion and Climate Risks
One of the principal challenges is extending the fund’s geographic coverage, as activity remains concentrated primarily in the city and province of Maputo. Freitas considers it necessary to expand operations to all provinces in order to reach companies that face greater difficulties in accessing credit.
The institution is also studying the possibility of creating a dedicated credit line to address climate risks, given Mozambican companies’ exposure to extreme weather events such as flooding and other phenomena that disrupt economic activity.
“One of the fund’s objectives is also to address the climate risks the country faces — in other words, one of the objectives is to reach companies when they need it,” Beatriz Freitas explained, referring both to investment needs and to difficulties caused by natural disasters.
The institution’s president rejected the notion that mutual guarantees function as subsidies or direct credit. The mechanism allows companies to approach banks for financing while SGM assumes part of the risk by issuing guarantees.
“The entrepreneur goes to the bank, the bank analyses and extends credit to the entrepreneur. What we do is stand alongside the entrepreneur, share the risk, and provide the guarantee,” she said.
Guarantees May Help Reduce Interest Rates
Over the longer term, SGM expects the mechanism to contribute not only to increasing the number of companies with access to credit but also to reducing financing costs on guaranteed operations.
“At this moment, our primary objective is for the largest possible number of companies to have access to credit. From there, once the financial system understands how it works and what it can help achieve, we will begin to see a reduction in interest rates on operations guaranteed by us,” Freitas said.
Beatriz Freitas also highlighted agriculture as one of the areas with the greatest growth potential in Mozambique and one of the programme’s focal sectors, given the opportunities for expanding business activity and financing within the sector.
Freitas, who is the first woman to lead the institution, took up her role after winning an international competitive process promoted by the World Bank. Before arriving in Mozambique, she held similar positions in Portugal, Cabo Verde, and Angola, and participated in mutual guarantee projects in Latin America.
SGM is a financial institution responsible for managing public guarantee solutions to facilitate access to financing for micro, small, and medium-sized enterprises across Mozambique.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/2026/09/28/negocios/empresas/sociedade-de-garantias-de-mocambique-preve-novo-financiamento-para-apoiar-mpme/
