KCB secures Ksh 4B for onward lending to women enterprises

 

KCB Bank has secured Ksh 4 billion (€30m) from the Bill & Melinda Gates Foundation and the European Investment Bank to increase lending to women enterprises.

The funds will be disbursed through the bank’s Female-Led and Made Enterprises (FLME) and KCB Foundation 2jiajiri programmes to help the businesses upscale.

Through the collaborations, the three organizations target to close existing gender gaps through financial inclusion where many women groups and enterprises are left behind.

“Despite their dominance, women’s economic potential is dwarfed by multiple challenges such as the lack of appropriately designed financial products, weak institutional capacity, and lack of incentives within banks to target and lend to women. The financial industry stands to significantly increase its bottom line by addressing banking’s gender gap: female financial inclusion – particularly the promotion of financial literacy, digital banking, and access to credit,” said Annastacia Kimtai, KCB Bank Kenya Managing Director.

Women’s Economic Empowerment at the Bill & Melinda Gates Foundation Director Greta Bull said unequal access to credit remains a huge challenge that holds back economic activity and social progress especially for women in Kenya.

“Across Africa, women need access to more and better credit to support their entrepreneurial activities. This partnership will help transform the banking and financial landscape in Africa and to create incentives for lending to women in business and make them contribute more towards the wider economic growth ambitions,” she added.

Statistics indicate that 24pc of entrepreneurial activities are women-led, but their potential is hindered by lack of access to startup capital, start-up support ecosystems and networks that deliver capacity building support and lack of knowledge and expertise to implement gender-lens investing strategies among venture capital firms and funds.

“The pioneering gender focused microfinance scheme led by KCB Bank Kenya will establish a benchmark for other visionary financing programs to tackle the $42 billion financing gap for female entrepreneurs in Africa,” noted Thomas Östros, European Investment Bank Vice President.

The women will also benefit from lower cost on loans that will be facilitated through digital technology and data and risk sharing.

Through FLME established two years ago, KCB Bank has lined up Ksh 250 billion to create solutions for women entrepreneurs that are flexible, accessible, and affordable.

“Kenya and the European Union are committed to delivering gender equality and this exciting new cooperation between the Bill & Melinda Gates Foundation, the European Investment Bank and the European Union will enhance opportunities and improve the lives of thousands of women and their families here in Kenya and later across Africa,” said Henriette Geiger, European Union Ambassador to Kenya.

The programme is also a 360 degree-intervention platform that seeks to fill the gap where traditional lenders have failed by supporting women and young people to navigate the complex entrepreneurial journey.

The bank says it has further disbursed loans worth Ksh 111.6 billion to over 600,000 FLME customers while the total FLME portfolio constitutes 35pc of its SME loan book.

By Sally Namuye