MOU signing aimed at supporting Zambian businesses and improving social impact

 

[Lusaka] 28 March 2023 – The Development Bank of Zambia (DBZ) today signed a Memorandum of Understanding with Norsad Capital, an impact investor and private credit provider offering tailor-made debt solutions to profitable growth-stage companies. The move promises to bolster direct investment into Zambia by supporting businesses that are committed to positive social impact.

Zambia, one of the youngest countries in the world based on median age, is undergoing a rapid demographic shift; this presents a unique opportunity for economic growth. The MOU solidifies this possibility, as growth initiatives are a key focus of Norsad Capital.

Speaking at the MoU signing ceremony at Lusaka’s Hilton Garden Inn, the DBZ’s Acting Managing Director, Maybin Muyawala said this cooperation agreement couldn’t come at a better time. “We are confident that this move will bring a much-needed injection into Zambia’s economic landscape.”

The Zambian economy rebounded in 2021, with GDP expanding by 4.6%, after contracting by 2.8% in 2020 due to various macroeconomic events. The MoU aims to contribute to the growth of the Zambian economy.

“Ultimately, both our institutions are focused on providing much-needed capital to businesses which can be used to promote economic growth and improve the lives of the people in Zambia and Africa at large,” added Muyawala.

According to the terms of the partnership, the parties will coordinate on large deals, share contacts for possible business, and split an investment opportunity if the amount needed exceeds the financing capacity available from each side.

Norsad Capital, which identifies itself as an impact investor with a focus on the Sustainable Development Goals (SDGs) of the United Nations, aspires to be a thematic impact investor that selects investments that clearly contribute to addressing social and environmental concerns. This is consistent with the DBZ’s objective to address inadequate and expensive access to capital for investment and to eliminate micro-level structural rigidities that impede public and private investment development, productivity, wealth generation, and job creation.

“Both our organisations share the same passion for ensuring that African businesses can thrive and succeed despite prevailing circumstances. Our agreement, therefore, ensures that we can, in partnership, simultaneously maximise deal flow and social impact in Zambia,” said Kenny Nwosu, CEO at Norsad Capital.

A particularly important element of the MoU is that both parties will support each other in working to further promote the private sector’s role in growing the Zambian economy as highlighted by Nwosu who adds, “We wish to encourage good corporate governance to promote sustainable private sector investment in Zambia.”

Nwosu also added that this also serves as an opportunity for Norsad Capital to plough back into its birthplace. “It’s a full circle moment, really. Norsad was first established right here in Zambia in 1990, as a collaboration between the Nordic and Southern African Development Community (SADC) governments, and it operated as a multilateral agency based in Lusaka, Zambia.

 In 2011, we transformed into a limited liability company, Norsad Finance, incorporated in Botswana and accredited by the International Financial Services Centre. And here we are, in 2022, having rebranded to Norsad Capital in line with our strategy to scale and deepen our impact throughout the continent.”

-ENDS- 

About Norsad Capital

Norsad Capital is an impact investor and private credit provider offering tailor-made debt solutions to profitable growth-stage companies that deliver desirable social and environmental impact. With a track record spanning over 33 years, Norsad Capital has invested over USD 500 million in more than 150 companies across the continent. 

About The Development Bank of Zambia

The Development Bank of Zambia (DBZ) is a Development Finance Institution (DFI) mandated through the Development Bank of Zambia Act, to provide long, medium and short term finance and equity investment, provide technical assistance and advisory services for the purpose of promoting economic development. DBZ has invested over USD300 million in over 350 companies since inception.

Norsad Capital (“Norsad”) acknowledges that climate change is the largest threat currently facing humankind and the environment at
large. Norsad subscribes to the science and the data as presented by the International Panel on Climate Change (IPCC), which indicates that manmade greenhouse gases (GHG) are responsible for trapping additional heat within the planetary system leading to an increase in the average global temperatures. [  Read more ]

Lesotho PostBank joins forces with provider of private credit Norsad Capital to create new opportunities for businesses in Lesotho

07/02/2023

Recognising their common goals, the Lesotho PostBank (LPB) has joined forces with Norsad Capital, a provider of private credit to businesses in a growth stage. This partnership was announced at a ceremonial event in Maseru, Lesotho, on 17 February 2023.

LPB was set up by the Government of Lesotho with the goal of providing financial services to the many unbanked and underbanked Basotho in the country.  To overcome the negative impact of financial exclusion, the Bank targets both rural and urban parts of the country for the expansion of its services.

Both LPB and Norsad Capital focus on providing much-needed capital to businesses, which can be used to promote economic growth and improve the lives of people on the continent of Africa.  “We recognise that we share common objectives in terms of private sector development in Lesotho, and this is what drives our decision to collaborate with each other,” explains Molefi Leqhaoe, the Managing Director of LPB.

The parties have signed a Memorandum of Understanding which sets out the terms of the partnership. According to Kenny Nwosu, CEO of Norsad Capital, “In line with Norsad’s growth strategy of deepening investments in SADC, the MOU paves the way for Norsad to increase its investment activities in Lesotho through leveraging off the local presence of LPB”.

In terms of the agreement, the two parties will share contacts for potential business; assist each other when putting together sizable deals; and share an investment opportunity should the amount required exceed the limits available for funding by each party.

“In addition to the various benefits, it will be helpful for us to have a partner on the ground in Lesotho who has local knowledge and can provide us with insights, for instance, about a business located in the country that we are considering doing business with,” Nwosu says.

From a regional perspective, the deal fits in perfectly with the Norsad Capital focus on the Southern African Development Community (SADC), since Lesotho is one of the 16 states that make up this region. “This is a region most under-served by financial institutions, yet there is enormous business opportunity in the area,” says Nwosu, explaining the reason for the company’s focus.

Identifying itself as an impact investor with a particular focus on the United Nations Sustainable Development Goals (SDGs), Norsad Capital aims to be a thematic impact investor that selects investments which clearly contribute to solving social and environmental challenges. This objective aligns with the overarching aim of the LPB: to improve the quality of life of the citizens of Lesotho. Many of the sectors that are of importance to Norsad Capital are equally significant for the LPB, namely:  improving access to finance and allowing for greater financial inclusion, agriculture, promoting infrastructure development, and tourism and hospitality.

All in all, this partnership augurs well for the future of the economy of Lesotho. Likely to make more capital available to growth-stage businesses in the country, this relationship will promote economic growth in the region.

Norsad Capital Funds Growth in the Assisted Living and Frail Care Sector

12/12/2022

Norsad Capital, an impact investor and private creditor provider, has structured a ZAR 70 million debt facility to Manor Health Services for the development of their assisted living and frail care operations located within the Helderberg Manor Retirement Village in Somerset West, South Africa.

Assisted living and frail care completes the ecosystem of a retirement village and future planning of mature lifestyle residents. This segment offers life rights with specialised and focused care thereby further supporting families to provide suitable and immediate care for their elderly family members. This sector achieves Sustainable Development Goals 3, Good Health and Wellbeing, ensuring healthy lives and promoting well-being at all ages is essential to sustainable development. Health is a fundamental human right and a key indicator of sustainable development.

Zubair Suliman, Investment Director at Norsad Capital and transaction lead said: “Norsad Capital has been actively supporting growth in the healthcare space and this funding presents another unique opportunity, in partnership with Manor Health Services, to expand in this segment. Assisted living and frail care offers the dedicated care to the elderly and vulnerable mature residents seeking quality and swift healthcare services. Norsad Capital’s funding commitment played a catalytic role in raising a local funding line for the construction of the 50 assisted living units and the 40 bed modern frail care centre. ”

Hein Ehlers the founder and CEO of Devmark Property Group said: “We are extremely pleased with the conclusion of our first transaction with Norsad Capital. Devmark through its subsidiary, Manor Health Services, took a strategic decision to invest in the health sector and specifically in assisted and frail care. Norsad Capital immediately understood the strategic nature and growth potential of the health services in this sector. We found their approach refreshingly different to most other financial institutions and we look forward to building a long[1]term relationship with them.”

About Norsad Capital

Norsad Capital is an impact investor and private credit provider offering tailor-made debt solutions to profitable growth-stage companies that deliver desirable social and environmental impact. With a track record spanning over 32 years, Norsad Capital has invested over USD 500 million in more than 150 companies across the continent.

For more information: www.norsadcapital.com

About Manor Health Services

Manor Health Services’ assisted living and frail care facility is located within the Helderberg Manor Retirement Village, an existing 257- unit retirement village, situated in Somerset West, Western Cape, South Africa.

For more information: www.devmark.co.za

A joint partnership encompassing $400mn in assets under management focused on African small and medium enterprises.

Norsad Capital and TLG Capital announced today the beginning of a partnership to cement the market-leading private credit platform for medium-sized companies across sub-Saharan Africa (SSA). [ Read more ]

Congratulations to Norsad Capital for winning the ESG Investment – Social Leadership of the Year Award at Reuters Events: Responsible Business Awards 2022! #RBawards22 #impactinvesting

Norsad Capital signs Memorandum of Understanding (MoU) with the Infrastructure Development Bank of Zimbabwe (IDBZ) to create new opportunities for Zimbabwean businesses.

18/09/2022

Recognising their common goals, the Infrastructure Development Bank of Zimbabwe (IDBZ) has joined forces with Norsad Capital, a provider of private credit to scalable businesses focused on growth. This partnership was announced at a ceremonial event in Harare, Zimbabwe, on 13 September 2022.

The parties have signed an MoU which sets out the terms of the partnership. According to Kenny Nwosu, CEO of Norsad Capital, “Our agreement means that we will introduce each other to potential transactions and seek to collaborate and share risk. We each have our own expertise and funding models, and together we can provide far more in-depth insights when putting together a deal.”

Both financial institutions focus on providing much-needed capital to businesses, which can be used to promote economic growth and improve livelihoods. “We recognise that we share common objectives in terms of private sector development in Zimbabwe, and this is what drives our decision to collaborate with each other,” explains Zondo Sakala, the CEO of the IDBZ.

In terms of the agreement, the two parties will share contacts for potential business financing in Zimbabwe; assist each other when putting together sizable deals; and share investment opportunities of appropriate thresholds that meet the funding requirements of each party.

“In addition to the various benefits, it will be helpful for us to have a partner on the ground in Zimbabwe who has local knowledge and can provide us with insights on businesses located in the country that we are considering doing business with,” Nwosu says.

From a regional perspective, the deal fits the Norsad Capital focus on the Southern African Development Community (SADC), where Zimbabwe is located. “This is a region and market under-served by financial institutions, yet there are enormous business opportunities in the area,” says Nwosu, explaining the reason for the company’s focus.

Identifying itself as an impact investor aligned to the United Nations Sustainable Development Goals (SDGs), Norsad Capital has a thematic approach and selects investments that clearly contribute to solving social and environmental challenges. This objective aligns with the overarching aim of the IDBZ: to improve the quality of life of Zimbabweans. Many of the sectors that are of importance to Norsad Capital are equally significant for the IDBZ, such as the transition to clean renewable energy and the pressing need for financial inclusion.

Norsad Capital, previously known as Norsad Finance, was first established in 1990. Norsad offers tailor-made debt solutions to profitable growth companies in Africa and has a goal to impact 100 million lives over the next decade in line with its strategy to scale and deepen its impact in Africa.

All in all, this partnership augurs well for the future of the economy of Zimbabwe. Likely to make more capital available to growth-stage businesses in the country, this relationship will promote economic growth in the region.

Despite progress in recent years, formal financial services remain beyond the reach of many people in Africa. And, even when these services become available, the rate of usage is low because of a range of factors, including the costs and the security of transacting.

It has been shown that mobile money and other non-traditional forms of financial services are key enablers for financial inclusion in Africa – They have disrupted traditional financial services by providing better ways to transfer funds than using cash. With mobile and other digital payment systems, customers in Sub-Saharan Africa are gaining access to business loans, savings, and other services that a traditional bank would otherwise provide. The greater availability of financial services has an incredible impact on many aspects of life in Africa and plays a role in alleviating poverty for communities.

One player in the omnichannel payment field helping to make the sort of impact that the continent needs is MFS Africa. It is the largest hub for omnichannel payments in Africa, which connects over 400 million mobile money users on the continent. Impacting largely the unbanked and the underbanked demographic on the continent, MFS Africa connects mobile network operators, money transfer organisations, cross-border payments remittance firms, financial service providers, and worldwide merchants to millions of mobile wallets on the continent.

“Our services focus on creating more possibilities for Africans needing to make payments, to carry out money transfers, and to remit funds to others,” explains Dare Okoudjou, Founder and CEO of MFS Africa.    “Merchants, banks, mobile operators, and mobile money transfer firms have come to rely on our compliant and cost-effectiveness service, and this is why the MFS Africa network has grown so extensively across the continent of Africa.”

MFS Africa has achieved a significant presence in Sub-Saharan Africa, being connected today to over 60% of all mobile money wallets in the region. Understanding the need for connecting mobile money to the rest of the world, MFS Africa recently broadened its bank and fintech base offering through the acquisition of US fintech GTP. This will enable the company to tokenize mobile money space and connect to traditional card scheme ecosystems such VISA and Mastercard. Okoudjou explains that “Our guiding principle is that African consumers and businesses should be able to pay for anything, both offline and online. We’ve always known that in order to really eliminate borders, we needed to connect mobile money to the rest of the world; card networks seem to be the most effective means to do so.”

The firm works in over 35 countries in Africa but believes that there are still more areas that it can provide its services to. It is against this background that MFS Africa negotiated a deal for additional funding from Norsad Capital, an impact investor offering tailor-made debt solutions to mid-market growth companies in Sub-Saharan Africa.

Kenny Nwosu, CEO at Norsad Capital, says: “The Norsad Capital term facility will assist MFS Africa to break into Nigeria, a market that is key to MFS Africa’s growth strategy. With its extensive population and capacity to do business, Nigeria accounts for the largest movement of money around the continent, and our funding is important as it comes at a point in the company’s development where it is poised for significant growth.”

According to Nwosu, “This is a very attractive investment for Norsad as MFS Africa has a strong market position, and this market share puts MFS Africa in a position to be at the forefront of financial inclusion and digital payments in Africa.”

There is also great synergy between the two service providers since MFS Africa is aligned with Norsad’s Purpose of Building a Better Africa. As Okoudjou of MFS Africa explains: “MFS aims to decrease the cost of money remittances to Africa. We currently connect mobile money systems to one another and to money transfer organisations, banks, and other financial institutions, enabling money remittances to and from mobile money accounts. Our move into the Nigerian market will allow us to extend our footprint extensively on the African continent, bringing much-needed financial services to thousands more people.”

In line with Norsad impact objectives, MFS Africa is aligned to Norsad’s Purpose of Building a better Africa. Mobile money has disrupted traditional financial services by providing a better way to transfer funds instead of cash. With mobile payments, customers in Sub-Sharan Africa are gaining access to business loans, savings, and other services as they would get in a bank. Mobile money has incredible impact on many aspects of life in Africa and plays a role in alleviating poverty for communities.

About Norsad Capital

Norsad Capital is an impact investor providing tailor-made debt solutions to mid-market growth companies in Sub-Saharan Africa. With a track record spanning over 32 years, Norsad Capital has invested in 150+ companies across the continent. For more information:  www.norsadcapital.com 

About MFS Africa

MFS Africa is the largest digital payments hub in Africa, with over 400 million Mobile Money users connected. The Company works closely with Mobile Network Operators (“MNOs”), Money Transfer Organisations (“MTOs”) and financial institutions to bring simple and relevant financial services to un-banked and under-banked clients in Africa: www.mfsafrica.com