Absa has invested in Lendable’s $255 million MSME Fintech Credit Fund 2 (LMFCF2), becoming the first African bank to participate in the emerging markets private credit strategy.

The pan-African bank invested in the fund’s senior notes and provided a subscription line to support the deployment of capital. The investment coincides with LMFCF2’s final close at $255 million, with the fund closing oversubscribed.

The fund provides asset-backed financing to financial services companies across emerging markets in Africa, Asia and Latin America, with a focus on businesses expanding financial access for underserved MSMEs and individuals. Its senior tranche carries an investment-grade rating.

Absa’s participation broadens the investor base for a strategy that has historically attracted capital from international development finance institutions, family offices and foundations.

“The significance of this transaction extends beyond the investment itself. It demonstrates how African financial institutions can participate more actively in global private credit markets and work alongside international investors to channel capital into businesses serving the real economy,” said Shyam Ganda, Lead Specialist: Banking at Absa Corporate and Investment Banking (pictured).

“As these markets continue to develop, partnerships such as this can help broaden the sources of capital available to high-growth businesses while strengthening the links between African and global financial markets.”

The investment gives Absa exposure to a diversified portfolio of asset-backed loans to fintech lenders operating across emerging markets. Lendable uses a technology and data-led underwriting approach, including its proprietary Maestro risk engine, to assess and manage investments.

“When a leading African bank chooses to invest directly in a strategy funding growth across its own continent, that's a powerful vote of confidence - both in Lendable, and in the underlying businesses we back,” said Chris Wehbe, CEO of Lendable.

“Absa's participation tells us that local institutions see the same opportunity international investors have backed for years, and that they're ready to invest in it on their own terms. We expect this to be the first of many such partnerships.”

LMFCF2 forms part of Lendable’s broader strategy of providing credit to technology-enabled financial services companies serving underserved customers across developed and emerging markets.