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Financial Insight, Lusaka| 5 August 2026— First Quantum Minerals Zambia has entered into a Memorandum of Understanding with five financial institutions; Zanaco, FNB, ABSA, Stanbic and Inde Credit to design and roll out tailored financing solutions for Zambian-owned mining service providers, in one of the most concrete steps yet to operationalise the country's Local Content Regulations.
The Opportunity Behind the Deal
Speaking at the signing ceremony, FQM Zambia Country Director Anthony Mukutuma framed the MOU as more than a banking arrangement, it is a response to what he called a structural gap in how Zambia captures value from mining. While jobs, taxes and royalties dominate public discussion of the sector's contribution, Mukutuma pointed to the supply chain itself as the largest underexploited opportunity. Last year alone, First Quantum funnelled well over $2 billion into local businesses supplying goods and services to its operations.
The barrier, he said, has never been demand, it has been access to finance, and the cost of that finance, which has left Zambian companies uncompetitive against better-capitalised international suppliers. The MOU is designed to close that gap directly.
How the Financing Model Works
Under the regulations the Geological and Minerals Development (Local Content) (Preference for Goods and Services in the Mining Sector) Regulations, S.I. No. 68 of 2025 — "Local Companies" will gain access to invoice financing, order finance and industrial term loans structured around their role in the FQM supply chain.
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The innovation sits in the risk model. Rather than underwriting each supplier against its own credit profile, historically the biggest obstacle for small and mid-sized Zambian firms participating institutions will price risk against First Quantum's own credit rating as the anchor buyer. This is supported by real-time digital platforms that verify invoices and purchase orders, allowing lenders to move faster and more confidently than traditional collateral-based underwriting would permit.
What the Banks Are Saying
Zanaco CEO Dr Mukwandi Chibesakunda H.C. positioned the bank's participation within a broader commitment to private sector growth and inclusive economic transformation, tying the agreement to national copper ambitions. She cited Ministry of Mines and Minerals Development figures showing 8% year-on-year growth in copper production, underscoring the government's target of reaching 3 million metric tonnes annually by 2031, a goal that depends on a local supply base capable of scaling alongside the majors.
Inde Credit CEO Peter Bwalya offered a complementary rather than competitive framing, describing his institution's role as feeding into the value chain to strengthen the sustainability of local enterprises. He noted that Inde Credit has been aligning its strategy with SI 68 for some time, and that the FQM partnership sharpens its underwriting by giving it a de-risked, anchor-backed structure through which to extend capital to suppliers and contractors.
Why It Matters
The MOU is a practical test of whether SI 68's ambitions, opening the mining value chain to Zambian-owned firms — can translate into bankable financing at scale. Anchor-buyer credit structures of this kind are common in mature supply chain finance markets but have been largely absent in Zambia's mining sector until now. If successful, the model could become a template other mining houses replicate, extending well beyond FQM's own supplier base.
The initiative also reinforces First Quantum's broader industrialisation push in North-Western Province, anchored by its Kansanshi and Trident operations and the Kalumbila Multi-Facility Economic Zone — positioning local supplier development as a pillar of that strategy rather than a peripheral corporate social responsibility exercise.
SOURCE
Financial Insight
