NAIROBI, Kenya Jun 29 – The Government is prioritizing solutions geared towards unlocking challenges that hinder micro, small and medium enterprises (MSMEs) from accessing capital. This involves expanding avenues for flexible lending rates and introducing products tailored to specific cadres of entrepreneurs to spur growth.
Speaking at a customer networking forum for Kenya Development Corporation customers and their partners, MSME PS Susan Mang’eni noted the huge potential among the youth and growing businesses in the country. Thus, funding—the missing link—is now a key government priority as it seeks to open more doors for access.
According to the PS, most MSMEs were reeling under the burden of heavy debts as well as poor financing that saw them die at their infancy and thus, a push for the government, and other development partners, to continually finance Development Finance Institutions (DFI) to cater for the growing needs of businesses in the country while keenly seeking solid ways of unlocking public sector financing
“There is a proposal for a tiered financial model that would structure financial products based on the borrower’s status, targeting groups such as fresh graduates, younger people venturing into business, those with disabilities, and women,” the PS noted that Kenya has a long way in catering to the different cadres of society.
But even as these new measures to capacitate businesses arise, the government says it wants businesses that have relied on DFIs longer to graduate to commercial banks and open up space for other younger businesses
PS Mang’eni says this situation has clogged the system, denying other deserving businesses the opportunity to access financing.
On her part, KDC Director General Norah Ratemo says the institution is working on a plan to shift its collateral mode. It will now discount collateral based on market value, not forced sale value, which she says will open doors for more entities to access financial support.
The networking forum was held under the theme “Building Synergies for Sustainable Growth,” providing a platform for customers to network, share experiences, explore business-to-business opportunities and gain insights into emerging financing solutions, export markets, capital markets and other opportunities critical to enterprise growth.
The KDC Customer Networking Forum marks the beginning of an ongoing customer engagement platform that will deepen collaboration among customers, Government and development partners.
It will enable enterprises to access financing, markets, strategic partnerships and business advisory services that drive sustainable socio-economic development.
