TLG Capital Backs Shona Capital Zambia with $5M SME Facility

Zain Latif, TLG Capital Founder & CEO

TLG Capital, a private credit fund manager focused on supporting high‑growth businesses across sub‑Saharan Africa, has closed a $5 million scaling facility for Shona Capital Zambia, a specialist SME lender providing fast and flexible financing to Zambian businesses. The transaction represents a significant milestone for both organizations and supports efforts to address the country’s persistent SME financing gap.

The facility has been structured to fund the expansion of Shona Capital’s loan book, with capital to be released in successive tranches as the company scales its operations and demonstrates continued growth. As the transaction develops, the structure is expected to attract additional guarantors and institutional partners, further increasing Shona’s lending capacity and long‑term sustainability.

The investment was made through TLG Capital’s Africa Growth Impact Fund II and marks TLG’s first investment in Zambia, underscoring the fund manager’s confidence in the market’s SME sector and Shona Capital’s operating model.

Shona Capital Zambia focuses on the $10,000 to $100,000 lending segment, serving small and medium‑sized enterprises that fall between traditional financing options. These businesses are often too established for microfinance institutions, yet too small or insufficiently documented to meet commercial bank requirements. By targeting this “missing middle,” Shona plays a critical role in providing growth capital to businesses that are vital to employment and economic development.

A key differentiator of Shona’s model is speed and flexibility. While traditional lenders can take several weeks, or longer, to process and disburse loans, Shona is able to disburse funds within as little as five days, enabling SMEs to respond quickly to working capital needs and growth opportunities.

Commenting on the transaction, Isha Doshi, Co‑Founder and Partner at TLG Capital, highlighted the scale of the opportunity in Zambia’s SME market. She noted that the country’s SME financing gap is estimated at $2 billion, with the most difficult segment to serve being businesses that sit between microfinance and commercial banking, precisely the segment Shona targets.

Kayinja Mfuni, CEO of Shona Capital Zambia, emphasized the company’s mission‑driven approach to lending. He explained that Shona was built on the belief that well‑run Zambian SMEs deserve access to fair and appropriate credit. Rather than relying solely on rigid documentation requirements, Shona prioritizes understanding each business’s cash flows, operating cycles, and growth potential, structuring financing solutions accordingly to support sustainable growth.

Source: Innovation Village