Global reinsurance group Munich Re has partnered with Africa Finance Corporation (AFC) to launch a US$1 billion Unfunded Managed Debt Mobilisation Program (UMDMP), delivering a programmatic credit risk-sharing facility designed to scale trade finance liquidity across Africa.
The programme provides African banks with faster access to expanded trade finance resources. By pre-establishing risk limits and parameters, Munich Re automatically assumes a portion of eligible AFC transactions.
AFC continues to retain a share of risk in each deal, ensuring the interests of both organisations remain closely aligned. Furthermore, as individual transactions mature, capacity within the programme is released and redeployed to fund new investments.
The first deployment phase targets 38 financial institutions across 11 African markets, focusing on core instruments that facilitate cross-border trade: Commercial Letters of Credit (LCs), trade-related loans, and trade confirmation and payment guarantees.
Both Munich Re and AFC confirmed that the portfolio’s scope will undergo periodic reviews with provisions to introduce additional credit instruments and economic sectors as the portfolio matures.
Commenting on the programme, Banji Fehintola, Executive Board Member and Head of Financial Services at Africa Finance Corporation, said: “Across the development finance landscape, there is a growing recognition that the scale of Africa’s financing needs cannot be met through traditional balance sheet lending alone. Multilateral development banks like AFC are increasingly embracing an originate-to-distribute model, with private capital mobilisation becoming central to how we deliver greater development impact.
“Managed debt mobilisation sits at the heart of this transition, enabling institutions like AFC to leverage our origination capabilities, structuring expertise and risk management frameworks to attract institutional capital at scale. This programme with Munich Re demonstrates how we can translate that ambition into practical, scalable solutions that expand financing capacity while optimising the deployment of our own capital. As the African Continental Free Trade Area deepens trade between African economies, the programme helps to solve committed capacity constraints for banks that finance that trade and strengthens AFC’s ability to be more instrumental in financing Africa’s development.”
Herbert Müller, Head of Global Credit Solutions at Munich Re, noted that the model provides the reinsurer with direct, diversified credit exposure across high-growth frontier corridors.
He stated: “Munich Re benefits from the strong pan-African footprint of AFC while AFC benefits from the strong capacity of Munich Re. The trust built between our two organizations through our cooperation since 2018 has allowed us to move from a transactional to a programmatic approach which allows us to support African financial institutions efficiently at scale. We see African trade as a long-term opportunity, and this programme gives us an efficient way to grow our business and improve our diversification at the same time alongside a trusted partner.”
Munich Re and AFC have collaborated on individual credit-risk syndications since 2018, completing multiple bilateral risk-sharing deals, including two earlier in 2026. The UMDMP institutionalises that pipeline into a standing, revolving facility.
The reinsurance facility also anchors AFC’s broader Managed Debt Mobilisation Program (MDMP), a platform through which other investors can participate alongside AFC, either by providing funding or by sharing risk.
AFC is in discussions with other African and global institutional investors about providing funding through the platform.
The transaction also complements AFC’s internal risk architecture. In August 2026, the development financier established AFC Captive Insurance Company Ltd, a Bermuda-domiciled captive backed by up to $30 million in equity capital.
