The European Investment Bank has signed two new credit lines for East-Africa for a total of EUR 95 million (Kshs 10.45 billion) to be made available through Equity Bank and Housing Finance Limited to support SMEs across Kenya, Tanzania, DRC and Uganda.
EIB Vice President Pim van Ballekom, responsible for operations in East Africa, commented: “The credit lines signed today will not only benefit people in Kenya, but are meant for people in neighbouring countries as well. The EIB is committed to supporting Kenyan Banks in providing credit to the young and growing population in the region.”
The EIB signed a EUR 75 million (Kshs 8.25 billion) credit line with Equity Bank, under which funds are earmarked for three subsidiaries; EUR 36 million (Kshs 3.96 billion) for Equity Tanzania, EUR 20 million (Kshs 2.2 billion) for Procredit DRC and EUR 19 million (Kshs 2.09 billion) available through Equity Uganda.
The on-lending will be available in USD or local currencies with the objective of contributing to job creation and poverty reduction. In addition, Equity Group will benefit from a EUR 2m (Kshs 220 million) technical assistance program funded by the EIB to support its strategy of transforming branches into SME business centres.
Equity Group Managing Director & CEO Dr James Mwangi said ‘With this facility of Kshs 8.25 billion (EUR 75 million) we will be in a position to support up to 1000 regional companies with an average loan of nearly Kshs 10 million each thus assisting develop local entrepreneurs to compete at regional level furthering integration and cross border trade.”
Next to this, a EUR 20 million (Kshs 2.2 billion) credit line under the EIB’s East and Central Africa Private Enterprise Finance facility was signed with HFC Limited to be channelled towards financing the working capital and expansion of the Bank’s SME customer base.
Over the last seven years, the EIB has provided EUR 321 million (Kshs 35 billion) in credit lines for Kenyan businesses, which have benefitted nearly 800 Kenyan companies, creating over 9,000 new jobs in agriculture, education, transport, tourism, trade and other sectors.
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