KCB Bank Kenya has set aside Sh1.3 billion to support Micro, Small, Medium Enterprises (MSMEs) in Kiambu county to help them weather the Covid-19 pandemic.
Under the arrangement, KCB will provide affordable facilities to enterprises whose businesses have been affected by the outbreak.
The county government will pay part of the interest (6%) while business owners will take up the balance (7%).
“The interest sharing, and guarantee model is one of the innovative ways to facilitate credit to catalyze the business growth of the entrepreneurs and enable economic recovery,” KCB director retail, Annastacia Kimtai, said on Friday.
She said the bank appreciates the potential MSMEs have on the economic growth in Kenya, hence its support for the sector.
"We see this facility as a strong cushion for small businesses in the county, something that should be replicated across the country. We hope it will boost our economic recovery and provide capital and other resources to small businesses to help them weather the crisis," Kimtai said.
If MSMEs do well, the economy does well, she added.
The fund targets existing MSMEs in Kiambu county where entrepreneurs will be financed according to their ability to pay based on their cash flows.
“We are very pleased to partner with the bank as we know the importance of entrepreneurship and the major role it plays in stimulating growth in both urban and rural areas,"Kiambu governor James Nyoro said.
He said small businesses have helped free people from the poverty trap.
"Theloan facilities provided by the bank will ensure business continuity during the crisis,” Nyoro added.
The programme has also drawn in four other partners—the Kenya National Chamber of Commerce and Industry (KNCCI), Master Card Foundation, Kenya Investment Authority and Zetech University, to drive the commitment to keeping businesses solvent in response to the pandemic.
The county government will develop policies and structures that support the utilization and sustainability of the fund, and also facilitate capacity building for entrepreneurs.
The facility is part of a raft of initiatives which KCB is running to support the revival of businesses affected by the Covid-19 pandemic.
In addition, the bank rolled out relief accommodation measures to cushion distressed customers.
