Small and medium enterprises (SMEs) face growth challenges in many emerging economies primarily due to limited access to financial support. For instance, in Africa, many SMEs on average fail within their first 5 years of operation. Traditional commercial banks often overlook SMEs for financial assistance because these businesses usually lack the formal documentation or collateral necessary to secure loans. However, the emergence of ethical banking practices is beginning to bridge this gap, aiming to extend financial services to a wider population, including SMEs. This chapter examines how sustainable ethical banking practices can mitigate these sustainability challenges and foster the growth of SMEs. The role of central banks in enhancing ethical banking was also discussed.