Thousands of Micro, Small, and Medium Enterprises (MSMEs) and cooperatives in Nakuru County are set to benefit from KShs.800 million set aside by KCB Bank Kenya to help them weather the effects of the COVID-19 pandemic.
This comes after the County Government of Nakuru and the Bank signed a partnership agreement on Friday.
Under the terms of the partnership, KCB will give low-cost loans to businesses and cooperative societies whose operations have been affected by the pandemic.
“We want to support businesses as they push for recovery from the effects of the pandemic. We are deliberate in our effort to be the ‘partner kwa ground’ for support towards MSMEs across the country.” Annastacia Kimtai, KCB Bank Director of Retail.
On the other hand of the agreement, the County Government of Nakuru has set aside KShs.52 million as an interest subsidy and credit guarantee. The government will cover a portion of the interest (5%) while business owners and/or cooperative organizations will cover the remaining 7.5 %.
The interest sharing and guarantee model is one of the bank’s creative approaches to facilitating financing to help entrepreneurs grow their businesses and support economic recovery.
Kimtai mentioned that KCB believes that the support provided will have a significant positive impact on Kenya’s people’s livelihoods and the economy as a whole.
“We know that small businesses are most at risk from the economic disruption posed by the global outbreak of coronavirus it is only through strategic partnerships including with county governments that we can support businesses to weather this crisis,” Kimtai added.
Fund target: MSMEs
This fund is aimed at current MSMEs in Nakuru County, and businesses will be financed depending on their cash flow and ability to pay.
Last year, KCB worked with many counties to provide interest-subsidized and credit-guaranteed loans to MSMEs to help them weather the adverse effects of COVID 19.
KCB will also assist entrepreneurs through its social investment arm, the KCB Foundation, through the 2iajiri initiative, which will provide youths with skills training and business development support to help them grow their businesses.
KCB has always been at the forefront to ramp up loans to micro, small, and medium firms, especially women-owned businesses.