Zimbabwe Stock Exchange Limited (ZSE) and the Harare Receivables Exchange (HRE) have signed a Joint Venture Agreement following the two organisations Memorandum of Understanding (MoU) to establish a framework for the development of a receivables financing platform. Accounts receivable financing is a type of financing arrangement in which a company receives financing capital related to a portion of its accounts receivable.
The project will deepen the stock exchange financial services sector according to ZSE, Chief Executive Officer, Justin Bgoni.
“MSMEs continue to face challenges of limited access to finance and the receivables financing platform will enable them access to working capital on competitive pricing,” Bgoni said.
“This is in line with the Governments’ National Financial Inclusion Strategy as well as the ZSE mandate of providing capital and risk management solutions to businesses.”
The proposed financing model has been successfully implemented in Asia and Latin America according to the ZSE CEO.
“The success stories are on the basis that receivables financing through a formalised marketplace reduces the risk for potential financiers,” Bgoni said.
“The ZSE is excited to be working with HRE on this project which will ultimately deepen our financial services sector.”
Latin American countries that have used the model include Peru, Chile, Mexico and Argentina according to perusal research done.
HRE claims to be the only receivables trading comp[any in Zimbabwe with a mission to provide secure, transparent and efficient working capital solutions for our clients that are underpinned by honesty, integrity, accountability and innovation.
The organisation provides investors with a secure, efficient and transparent way to trade short term receivables.
