Types of SME loans you can get from Co-op Bank

Are you a small business looking for financing for your business? Well, the Co-operative Bank of Kenya has some of the best financing options tailored for various SMEs’ needs.

Below are some of the SME financing products offered by the lender.

MSME Overdraft Working Capital

The Co-op Bank MSME Term Loan is a type of loan that allows small and medium-sized enterprises to access the financing needed to expand or raise their business supply capabilities.

Under this product, borrowers can access financing under three categories: Bronze, Silver, and Gold. Each category has a varying loan limit, meaning borrowers access various loan limit depending on the category they fit it.

The Bronze package provides financing of up to Sh600,000, Silver Sh6 million and Gold Sh10 million.

The amount can be repaid in up to 60 months based on the level of the borrower’s business and the type of security provided.

Mkopo wa Kujengana – Business

Mkopo wa Kujengana Loan is available to individual group members. The group must be registered as a self-help group by the relevant government authorities.

Under this product, borrowers not only access financing but also receive training on how to manage it.

The loan is based on a co-guaranteeing mechanism and members qualify for the loan after 8 weeks of training.

Msamaria Women’s Loan: A perfect solution for women in business

Overdraft

The Co-op Bank overdraft facility allows enterprises to access funds even when their savings balance is below zero, enabling them to continue with their operations without interruptions.

Borrowers can repay the borrowed amount at any given time without any penalties. To qualify for this loan, borrowers must have:

• Copies of identification documents, that is, Memorandum and Articles of Association (for registered companies)
• Certificate of Incorporation (for registered companies)
• Business Registration Certificate
• Identity cards for borrowers who do not have registered businesses
• Identity cards for directors of registered companies and registered businesses
• Bank statements for 6 months, audited accounts for loans above Ksh 5 million
• Resolution to borrow (for registered companies), details of business location and securities to be provided

Supply Chain Financing

This is a financing solution designed to help MSMEs pay suppliers. It facilitates financing for suppliers to the Anchor customer to obtain early payment once they submit their invoices.

Features

Security:

• For limits up to 2M –Chattels i.e. Motor vehicle discounted at 150%
• Cash and Land for exposures above 2M

Benefits of the parties involved

Benefits to Anchor

• The solution allows the Anchor to maintain or extend the payment terms with the Bank
• Ensuring the Anchor suppliers have access to working capital.
• Negotiate Better pricing for purchased goods and services and enjoy cash discounts

Benefits to Suppliers

• Alleviate the cash flow challenges of suppliers by accelerating the conversion of receivables (invoices) into cash.
• Extend financial access to suppliers who lack collateral – using approved invoices as a form of credibility and surety.
• Help businesses to grow with enhanced access to finance
• Reduce days of sales outstanding (debtor’s days).

Requirements

• 3 years audited accounts
• Company/ Business profile
• Banks statements (12 months) if new customer to Co-operative Bank
• 12 months payments data of the client from anchor
• Credit application