Small and Medium-sized Enterprises within the manufacturing, real estate, healthcare, education and agriculture sectors are set to benefit from empowerment programmes by HF Group and the Strathmore business school.
This through the partnership that seeks to offer training, capacity building and tailor-made financing solutions geared towards business growth.
The listed firm, HF Group, will be engaging in the strategic partnership through its banking subsidiary, Housing Finance Company (HFC).
Commenting on the pact, HF Group CEO Robert Kibaara said SMEs are at the heart of Kenya's social, economic and industrial development, and such partnerships would be essential in promoting their growth and GDP contributions.
“With this partnership, the Bank and Strathmore will leverage each other’s expertise to create a supportive ecosystem specifically designed to propel SMEs to the next frontier of growth and economic contribution,” Kibaara said.
He further notes that the collaboration will aim to leverage the respective strengths of both partners to deliver relevant insights through trainings on entrepreneurship, financial literacy, e-commerce, business mentorship and coaching.
SMEs are noted to be critical players in the country’s business environment constituting about 98 per cent of all businesses.
This translates to almost 30 per cent of job creation opportunities annually and three per cent contribution to GDP.
This mirrors the sentiments of Strathmore University business school executive dean, Caesar Mwangi who notes that the sector is critical to the country’s economic vitality as he firmly believe that supporting the sector is the right move in expanding trade and employment.
Also as a measure to mitigate the challenges that these SMEs face in their lifeline, the partnership has been backed to boosting the lifespan of the enterprises which according to reports, often celebrate their second birthdays.
A 2018 Kenya National Bureau of Statistics (KNBS) report shows approximately 400,000 SMEs do not celebrate their second birthday and very few of them reach their fifth birthday.
More than half, 46 per cent of Kenya’s SMEs reportedly close within a year of founding, the report reads in part.
Echoing this, is the recent Annual Performance Report for MSMEs for the 2021/2022 Financial Year by the National Treasury which notes that majority of newly established Micro, Small and Medium Enterprises in the country do not survive the fourth birthday.
It notes that the businesses, despite the critical roles they play in the economy, continue to face a myriad of challenges including constrained access to finance, market challenges and weak business strategies.
“With this partnership, we want to be at the forefront of turning the tides for SMEs towards sustainability,” Kibaara said.
