- The funding is capped between $100,000 (Sh13.2million) and $500,000 (Sh66.3 million).
- It will mainly focus on sustainable agriculture, energy, clean mobility, logistics and waste management sectors.
Image: ALFRED ONYANGO
Small and Medium-sized Enterprises are set to benefit from Sh2.88 billion funding by Oxfam Novib in partnership with Goodwell Investments, pointing towards resilience and increased access to credit.
The funding targets enterprises in the country and its East African counterparts, Ethiopia and Uganda, with a main interest in women-led and owned firms.
According to Tamara Campero, investment manager at Oxfam Novib, the pact is part of their broader vision to achieve a fair, green and inclusive future.
“We have played a key role in developing the micro-finance sector as a means to provide access to financial services where they were most needed. We are ready to change direction toward a less-served segment of the market, access to finance, as we acknowledge the challenges SMEs are facing in the region, especially those that are women-owned,” Campero said.
Dubbed ‘pepea fund’, it seeks to support early-stage growth companies that are still struggling to secure finance from banks and investment funds to accelerate growth.
The funding is capped between $100,000 (Sh13.2million) and $500,000 (Sh66.3 million), and will mainly focus on sustainable agriculture, energy, clean mobility, logistics and waste management sectors.
This is on the backing that the sectors produce many of the basic goods and services that represent a huge proportion of household spending for lower-income communities.
“In order to improve the quality and affordability of these essentials, ‘Pepea’ is targeting SMEs that drive the growth of a greener, fairer and more gender inclusive ‘human economy' that serves the needs of society while respecting the planet,” Campero said.
She added that the fund has concrete impact targets to guide the investment strategy, including the expansion of the aforementioned female stakeholder's involvement across the value chain and the creation of new jobs.
It also seeks to directly contribute to UN’s Sustainable Development Goals for climate action and gender equality.
To enhance accountability and success of the credit, the partners have committed to gathering impact feedback from the target audience with a strategic board made up of representatives from SMEs, as well as their end users.
This is to ensure the fund managers take the voice of the community into account to improve impact performance and better identify unaddressed needs.
On her part, Els Boerhof, managing partner at Goodwell Investments, commented the partnership saying its the right move to better serve the needs of SMEs.
“We will therefore be looking for further innovative ways to address the concerns of these enterprises as we are extremely pleased to have the opportunity to do so with one of the critical NGOs in the impact sector," Boerhof said.
"With the many synergies between our organisations, I'm convinced that together, we can set higher standards in the impact investing space.”
The partnership funding echoes the government's plan to promote small businesses toward growth through affordable funding.
This is under the Hustler Fund initiative which is to commence its group funding in the first weeks of April.