Includes special features of this country’s banking system and rules/laws that might impact U.S. business.
Last Published: 7/23/2019

Botswana’s banking sector consists of a central bank (Bank of Botswana) and commercial banks: ABSA (formerly Barclays Bank) Botswana, Standard Chartered Bank Botswana, First National Bank Botswana, Bank of Baroda Botswana Ltd., Stanbic Bank Botswana, Capital Bank, African Banking Corporation, Bank Gaborone, State Bank of India, Banc ABC, and Bank of India.  All commercial banks are either majority or wholly foreign owned. 

There are a growing number of investment and corporate finance institutions, including Investec Group, Andisa Bank, Mazars Corporate Finance, and the African Banking Corporation of Botswana, which specialize in structured trade finance, treasury operations, and investment banking.  All are geared towards financing for existing and new businesses.  However, most commercial banks do not finance start-ups but rather finance existing businesses either for expansion or acquisition, and also have high collateral requirements that make it difficult for many to access their financing.  The financial institutions are now improving the range of services they provide, including a new emphasis on small and medium-sized enterprises.  The U.S. Government has also, through USAID’s Development Credit Authority (DCA), introduced a loan guarantee scheme that is administered through the Barclays Bank of Botswana to assist SMEs.  In 2016, OPIC approved a $250 million loan guarantee facility to stimulate diamond processing in Botswana and partnered  with Barclays and Lazare Kaplan on the first tranche of $125 million.  OPIC recently signed agreement with Standard Bank Group (registered as Stanbic Bank in Botswana) for the second tranche. In 2008 the government established the Non-Banking Financial Institution Regulatory Authority to ensure that the non-banking financial sector operates in an efficient and orderly manner.

The Bank of Botswana, is responsible for monetary policies, central banking services, supervision of financial institutions, issuing of bank notes, implementing exchange rate policies, administering exchange controls, and foreign exchange reserves management.  The bank's financial statements comply with international standards.  Short-term finance, including pre- and post-shipment credit, is readily available through the commercial banking system at market rates of interest.  Export credit insurance is available through the Botswana Export Credit Insurance (BECI) agency.

The provisions for U.S. and other foreign firms borrowing in Botswana are liberal, while local banks remain highly liquid.  The country’s commercial banks, however, have difficulty making long-term credit available due to the short maturity nature of their deposits and small capital bases.


 

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