Deep and well-functioning capital markets are essential to economic development. They provide the finance that businesses need to grow. Recent research by the IFC highlights the transformative impact of deepening capital markets in low- and middle-income countries – contributing $4 trillion in capital. Yet across sub-Saharan Africa, capital markets in many countries remain shallow, limiting the ability of financial institutions to extend credit and support growth.
Securitisation – the process of transforming illiquid assets into tradable securities such as bonds – offers a powerful tool to address these constraints. It enables lenders to recycle capital, manage risk, and unlock new sources of funding. Globally, securitisation has played a key role in expanding access to finance. Yet in much of Africa, its potential remains untapped.
Recognising this gap, we have jointly commissioned this report with FSD Africa to explore how securitisation can contribute to the development of capital markets across the continent. The report provides a detailed assessment of current market conditions, barriers to scale, and practical opportunities for growth.
The market is nascent, but it is one that we are keen to explore and understand. A limited number of transactions across the continent has constrained investor confidence and slowed the pace of market development. For BII and FSD Africa, securitisation can support our strategic objective of mobilising capital for sustainable development, particularly across the micro, small and medium enterprise (MSME) sector. Development finance institutions and multilateral banks have a catalytic role to play in derisking early transactions and crowding in private capital.
We are pleased to share this report and invite all stakeholders – from policymakers and regulators to investors and financial institutions – to engage with its findings and take forward its recommendations.
