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Sweden’s development finance institution, Swedfund, announced on Tuesday an additional $5 million investment in the TLG Africa Growth Impact Fund II (TLG II), reinforcing its commitment to preserving and creating jobs across Africa’s small and medium-sized enterprises (SMEs).

The new allocation builds on Swedfund’s $15 million investment in 2025, bringing its total commitment to $20 million. The investment forms part of TLG II’s second close, alongside contributions from Proparco, Calvert Impact Capital, and other existing investors.

SMEs are widely recognised as engines of job creation and local economic growth, yet many struggle to access financing tailored to their needs. TLG II provides flexible, long-term debt backed by bank guarantees, enabling viable companies to secure loans with sustainable tenors and interest rates. This approach helps businesses strengthen operations, expand sustainably, and generate employment.

“Through our continued engagement with TLG II, Swedfund helps address an important financing gap for SMEs in Africa,” said Jonas Tornblad, Investment Manager at Swedfund. “Flexible and tailored credit solutions can support viable companies with temporary liquidity needs, helping to preserve jobs while enabling businesses to recover, grow and create new decent employment opportunities.”

By supporting scalable credit solutions, Swedfund’s investment is expected to preserve existing jobs in SMEs facing liquidity challenges, create new jobs through business expansion, and strengthen local economies by enabling SMEs to access sustainable financing.

As Sweden’s development finance institution, Swedfund’s mandate is to reduce poverty through sustainable private-sector investments in developing countries. Its portfolio contributes to job creation and access to essential services such as electricity and food, and supports the 2030 Agenda and the Paris Agreement goals.

Swedfund operates as a long-term, catalytic investor, mobilising private capital while also conducting feasibility studies to support sustainable public infrastructure and trade. Managed by Sweden’s Ministry of Finance and financed through portfolio reflows and capital injections from the Ministry for Foreign Affairs, Swedfund plays a central role in Swedish development cooperation.

This latest investment underscores Swedfund’s growing role in Africa’s SME ecosystem, helping to unlock growth potential and strengthen resilience in economies where small businesses are vital to livelihoods.