Africa Finance Corporation takes stake in East Africa credit guarantee firm Dhamana

Mintesinot Nigussie

Africa Finance Corporation (AFC) has taken an equity stake in Dhamana Guarantee Company, a credit enhancement platform designed to expand local currency financing for infrastructure projects across East Africa. The investment forms part of AFC’s approved commitment of up to 20 million US dollars in Dhamana’s capital, with an initial injection of 10 million US dollars.

The Nairobi-based guarantee company is structured to provide credit guarantees that enable infrastructure developers to access domestic debt markets, particularly pension funds and other institutional investors, on improved terms. Dhamana’s model is built on similar credit enhancement structures in West Africa, including InfraCredit Nigeria, where AFC is a founding shareholder.

Banji Fehintola, executive board member and head of financial services at AFC, said the investment would help deepen domestic capital markets in East Africa by linking institutional savings to bankable infrastructure projects.

Dhamana chief executive Christopher Olobo said AFC’s entry into its shareholder base marked a strong institutional endorsement of its mandate. The partnership would strengthen the firm’s capital base and governance as it scales its guarantee operations.

Dhamana is backed by a consortium of development partners and institutional investors and is expected to play a role in expanding credit guarantees across infrastructure sectors in East Africa.

Overall, AFC’s investment in Dhamana reflects its strategy of supporting credit enhancement vehicles across Africa to mobilise domestic capital and improve the financial sustainability of infrastructure financing.