Burkina Faso - Trade Financing

Trade Financing

Last published date: 2022-11-30

Methods of Payment

The preferred method of doing business for day-to-day purchases is in cash, in CFA Francs. Most businesses in Ouagadougou and Bobo-Dioulasso do not accept payment cards or personal checks. More and more companies are accepting electronic funds transfer and mobile cash payments (using the mobile phone network). Although there are many companies offering these services, the most popular one is Orange Money.

For larger transactions, a letter of credit may be used. Suppliers may expect 50% to 75% payment in advance, with the balance due upon delivery.

Banking Systems

Though Burkinabe banks continue to have high levels of cash reserves, their credit financing is limited to short-term credit, which constitutes about 60% of their financing portfolio. Thus, few manufacturing and trading companies benefit from long-term financing, which impedes economic growth. Small to medium-sized entrepreneurs still have difficulty accessing credit.

The traditional banking sector is composed of 14 commercial banks and three specialized credit institutions. A network of microfinance institutions and credit unions has also grown rapidly.

Three specialized credit institutions finance the majority of home, furniture, car, and moped acquisitions: la Société Burkinabe d’Equipement (S.B.E.), la Société Burkinabe de Crédit Automobile (SOBCA), and la Financière du Burkina (FIB). Two additional credit institutions make specialized loans to small and medium-scale enterprises: the “Projet d’Appui à la Création des Petites et Moyennes Entreprises (PAPME)” and Fidelis Finance Burkina Faso, formerly known as Burkina Bail. These institutions finance the acquisition of equipment by lease.

Questions and inquiries regarding Burkina’s banking system can be addressed to:

Association Professionnelle des Banques et Etablissements Financiers du Burkina (APBEF-B)

01 B.P. 6215 Ouagadougou 01, Burkina Faso

Tel: (+226) 25 31 20 65; Fax: (+226) 25 31 20 66

E-mail: apbef-b@cenatrin.bf

Foreign Exchange Controls

The Burkinabe investment code provides the right to transfer capital and revenues secured by foreign personal and legal entities, which invest in Burkina Faso in foreign currencies. Foreign investors have the right, subject to foreign exchange regulations, to transfer dividends, returns on capital invested, and the proceeds from liquidation of assets, in the same currency used for the initial investment.

For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide.

To access Burkina Faso’s ICS section on financing, visit the U.S. Department of State Investment Climate Statement website.