KITTY

Equity signs Sh11bn MSMEs credit facility with European banks

The deal involves Germany’s DEG, the Netherlands FMO and the UK’s CDC Group.

In Summary

•This is the fourth tranche for Equity Group after having signed a $50 million (Sh 5.5 billion) loan facility with IFC in September.

•It secured a $100 million (Sh11 billion) deal from PROPARCO in October and a € 125 million (Sh16.5 billion) loan facility signed last week with the European Investment Bank.

Equity Bank CEO James Mwangi
Equity Bank CEO James Mwangi
Image: FILE

Equity Group Holdings has signed a $100 million (Sh11 billion) loan facility with Team Europe, Germany’s DEG, the Netherlands FMO and the UK’s CDC Group.

The syndicated facility is for on-lending to MSMEs, to help them recover from the effects of the  Covid-19 pandemic on their businesses.

 

The impact of the Covid-19 pandemic started as a health crisis, and quickly became an economic and humanitarian crisis that has seen more than 40 per cent of Kenyan micro, small and medium business owners affected by the great economic slowdown
James Mwangi, managing director and CEO, Equity Group.

In its going support programme, it has already funded opportunities in manufacturing of PPE’s, logistics, online businesses, agro-processing, fast moving consumer goods and agriculture value chains. 

 “The impact of the Covid-19 pandemic started as a health crisis, and quickly became an economic and humanitarian crisis that has seen more than 40 per cent of Kenyan micro, small and medium business owners affected by the great economic slowdown," said  James Mwangi, managing director and CEO, Equity Group.

Christiane Laibach, CEO of the DEG Management Board said:“ Through our cooperation, we are contributing to supplying local SMEs with credit, which is particularly important and in demand at present.” 

CDC Kenya head of office and coverage director, Seema Dhanani, said the institution has invested in Kenya for over 70 years,  and is committed to increasing the resilience of businesses, boosting inclusive growth, and contributing to the country’s long-term economic recovery.

"We are delighted to partner with DEG and FMO to provide much-needed capital to support entrepreneurs and SMEs in Kenya,"Dhanani said.

Huib-Jan de Ruijter, Chief Investment Officer at FMO said: “ The facility will be a lifeline for the ‘missing middle’, providing businesses with much needed capital, while supporting jobs and communities. The syndication with DEG and CDC shows the strength of DFI partnership and collaboration.’’   

The UK is fully committed to delivering a strong, resilient economic recovery from Covid-19 in Kenya,British High Commissioner to Kenya,Jane Marriott, said.

This is the fourth tranche for Equity Group after having signed a $50 million (Sh 5.5 billion) loan facility with IFC in September.

It secured a $100 million (Sh11 billion) deal from PROPARCO in October and a € 125 million (Sh16.5 billion) loan facility signed last week with the European Investment Bank, to fortify credit flows and liquidity to MSMEs totaling Sh44 billion.