KCB Bank Kenya has set aside at last KShs.800 million to support thousands of Micro, Small, and Medium Enterprises (MSMEs) and cooperatives in Nakuru County to help them weather the effects of the COVID-19 pandemic.
This follows the signing of a partnership agreement between the County Government of Nakuru and the Bank on Friday.
Under the arrangement, KCB will provide affordable facilities to enterprises and cooperative societies whose businesses have been affected by the outbreak. In the arrangement, the County Government has set aside KShs.52 million as interest subsidy and credit guarantee. In this case, the government will pay part of the interest (5%) while business owners and/or cooperative societies will pay the balance of 7.5%.
“We want to support the businesses as they push for recovery from the effects of the pandemic. We are deliberate in our effort to be the ‘partner kwa ground’ for support towards MSMEs across the country. We believe that the support given will go long way to benefit the livelihoods of our people and our economy as a whole,” said KCB Bank Director Retail Annastacia Kimtai.
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“The interest sharing and guarantee model is one of the innovative ways the bank has developed to facilitate credit to catalyze the business growth of the entrepreneurs and enable economic recovery. We know that small businesses are most at risk from the economic disruption posed by the global outbreak of coronavirus It is only through strategic partnerships including with county governments that we can support businesses to weather this crisis,” she added.
This fund targets existing MSMEs in Nakuru County where entrepreneurs will be financed according to their ability to pay based on their cash flows.
Last year, KCB partnered with various Counties in lending to MSMEs under interest subsidy and Credit Guarantee to cushion them from the effects of COVID 19.
Nakuru County, Governor, H.E Hon Lee Kinyanjui said” We are keen on this partnership as it speaks directly to the core of our economy- MSMEs. The country is aligned to the fact that this segment is what drives the economy and therefore requires to be fully supported”.
Beyond the funding, KCB will also support entrepreneurs through its social investment arm KCB Foundation was through the 2iajiri program, which will provide youths with skills training and business development support to grow their businesses.
KCB Bank Kenya is the leading MSME Bank in Kenya. In 2020 at the height of the pandemic KCB signed a partnership agreement with World Bank’s International Finance Corporation (IFC) as lead syndicator to scale up lending to micro, small and medium enterprises including women-owned businesses.