Zimbabwe’s banks are seeking funding from development finance institutions (DFIs) and using syndicated lending to provide longer-term capital to mining companies, as a mismatch between short-term bank deposits and projects that can take a decade to mature threatens to constrain investment, Mining Zimbabwe can report.
By Ryan Chigoche
Commercial banks typically lend for two to five years, while a greenfield mining project can take seven to 10 years before generating stable cash flows. The gap is becoming more important as the mining industry seeks about US$10 billion in investment over the next five years, according to the Chamber of Mines of Zimbabwe, with capital needed to expand existing operations, develop new mines and increase processing capacity.
In an interview with Mining Zimbabwe, Bankers Association of Zimbabwe (BAZ) Chief Executive Fanwell Mutogo said the mismatch was primarily driven by the short-term nature of local bank deposits.
“Zimbabwe is indeed experiencing a structural mismatch, which is primarily brought about by the highly transitory nature of local bank deposits. Commercial banks are heavily reliant on short-term deposits and are bound by strict liquidity requirements. This makes it inherently difficult to fund seven-to-10-year greenfield exploration projects using short-cycle liabilities,” he said.
The constraint, however, is not simply that banks are unwilling to lend to mining. According to 2026 Reserve Bank of Zimbabwe data, the sector accounts for about 8.1% of total banking-sector credit, making it the fifth-largest recipient of loans after households, agriculture, distribution and manufacturing.
The figure points instead to a mismatch between the type of funding available and the long development cycles of mining projects.
“The struggle to access finance does not necessarily suggest that banks are arbitrarily overpricing risk; rather, it points to the structural challenge of inadequate long-term finance in the domestic market,” Mutogo said.
Mining projects require substantial capital before they generate predictable revenue, with funding needed for exploration, feasibility studies, mine development, equipment, processing facilities and supporting infrastructure. That makes the sector difficult to finance through short-cycle liabilities alone.
The response is increasingly to bring longer-term institutional capital into the financing chain. Mutogo said banks were partnering with multilateral institutions and DFIs to secure credit lines that could be passed on to mining companies.
“The core structural weakness is that mining inherently requires massive, patient capital. Banks are highly aware of this constraint and are actively trying to solve it by aggressively partnering with multilateral institutions and DFIs to secure long-term credit lines that can be on-lent to miners at competitive rates,” he said.
Such partnerships can extend financing to five, seven or even 10 years, bringing the tenure of funding closer to the development cycle of major mining projects.
“These partnerships allow domestic banks to unlock longer-tenure financing lines that can extend to five, seven, or even 10 years, providing the patient capital required to bridge the gap from early-stage development to stable cash-flow generation,” he said.
Syndicated lending is providing another avenue for banks to increase their capacity by combining balance sheets and sharing exposure to larger transactions.
At Mine Entra 2026, CBZ Holdings Divisional Director for Corporate Banking Lawrence Nyazema said total banking-sector deposits stood at around US$6 billion, compared with the mining sector’s US$10 billion investment requirement over five years.
He cited the US$125 million syndicated facility arranged by eight domestic banks for Mutapa Gold Resources as an example of lenders pooling capital to finance large mining investments.
The transaction illustrates how local banks can participate in larger projects by spreading exposure across several institutions, although the underlying need for longer-tenure funding remains.
That is where regional and international DFIs become important. Mutogo said institutions such as Afreximbank and the Trade and Development Bank (TDB) were helping domestic lenders mobilise larger facilities and strengthen their capacity to finance mining.
“Given the immense capital requirements of the mining industry, local liquidity is often not enough. As such, domestic banks actively utilise and seek reprieve from international partners and Development Finance Institutions (DFIs) such as Afreximbank and the Trade and Development Bank (TDB) to syndicate larger facilities and bolster their lending capacity,” he said.
The financing challenge is likely to become more pronounced as Zimbabwe seeks to develop new mines while pushing greater beneficiation and value addition, which require additional investment in processing plants, equipment and supporting infrastructure.
For miners, longer-tenure DFI-backed facilities can provide capital better aligned with the economics of projects that take years to mature. For banks, access to external long-term funding allows them to participate in larger mining transactions without relying entirely on short-term domestic deposits.
With the sector targeting US$10 billion in investment over the next five years, expanding access to DFI-backed funding while deepening syndicated lending could help narrow the gap between the capital Zimbabwe’s mining industry needs and the financing capacity of its domestic banking system.
