- The deal is expected to support healthcare providers to acquire medical equipment for the Covid-19 response
- IFC said the kitty will be available to smaller businesses in the health sector in seven African countries
Cooperative Bank of Kenya has signed a $300 million (Sh32 billion) health partnership with the International Finance Corporation (IFC) and health technology firm Philips.
The deal is expected to support healthcare providers to acquire medical equipment for the Covid-19 response.
IFC said the kitty will be available to smaller businesses in the health sector in seven African countries— Kenya, Cameroon, Ivory Coast, Rwanda, Senegal, Tanzania, and Uganda— that are seeking money for essential medical equipment.
The partnership, the first under the IFC-led Africa Medical Equipment Facility, will see the business access funding of between Sh535,000 ($5,000) and Sh214 million ($2 million) to help them lease or purchase medical equipment.
"This partnership with IFC and Philips will allow Co-operative Bank to extend credit to a wider range of investors in the health sector, who previously have found credit availability a challenge,” Co-op Bank Group MD Gideon Muriuki said.
“Health expenditure is one of the largest budget items in many households in Kenya; every support to make it easier for the sector to prosper and benefit our people is welcomed.”
The facility also comes with advisory services program to help small businesses in the healthcare sector strengthen their medical equipment procurement processes, financial management competencies and business planning.
Financial institutions such as Co-op Bank will benefit through strengthened credit underwriting skills for the healthcare sector players, with many being small and medium-sized facilities for low-income populations.
Many small healthcare operators in Africa struggle to access bank loans due to their perceived high risk of default, making it difficult for them to acquire medical equipment, renovate, or recruit qualified staff.
IFC managing director Makhtar Diop said beneficiaries of the kitty will be well placed to respond to Covid-19 and deliver other vital services.
Early this year, the local lender secured a $75 million (Sh8.3 billion) loan from World Bank’s institution for onward lending to small businesses hurt by the Covid-19 pandemic.