A consortium of banks including – KCB Group, Diamond Trust Bank, NCBA, Cooperative Bank, and Equity Group have pledged KSh 10 billion to fund SMEs.
The banks are using Stawi – a digital platform – to improve access to credit and improve SMEs businesses.
According to the Kenya National Bureau of Statistics (KNBS), the informal sector provided employment to 83.6 percent of Kenyan workers in 2018.
Joshua Oigara, the chairman of the Kenya Bankers Association, said that Stawi, which piloted in April has registered 100,000 businesses. In addition, he said that they have disbursed KSh100 million to SMEs since inception.
In addition, Oigara said that SMEs will enjoy a fixed interest rate of 9 per cent and can borrow between Ksh50,000 and Ksh250,000.
In a report, Kenya Economic Update No.20, the World Bank lauded Stawi as an innovative product that enables credit-information sharing and promotes transparency thus easing barriers to access to credit.
Smart, secure, and innovative financial products will allow SMEs to access funding and promote economic growth.
Updated on November 7th 2019
An earlier version of this article stated that KCB Group, Diamond Trust Bank, NCBA, Cooperative Bank, and Equity Group have pledged KSh 100 billion to fund SMEs. That is not correct. The article has since been updated to reflect the correct amount.