World Bank to boost SME lending in Kenya
28 April 2016, 11:14
Nairobi - World Bank's private sector arm, the International Finance Corporation (IFC), on Wednesday said that it plans to increase investments in Kenya that are targeted at boosting the level of lending to Small and Medium Enterprises (SMEs).
IFC Country Manager for East Africa Manuel Moses told Xinhua in Nairobi that financial institutions are reluctant to lend to SMEs because they are considered too risky.
"So we are looking for banks we can partner with that can help us achieve our goal of increasing the level of credit that is available to SMEs," Moses said on the sidelines of the workshop on Catalyzing Affordable Housing Finance in Kenya.
IFC is collaborating with nearly ten banks and has provided close to 500 million U.S. dollars for onward lending to SMEs.
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The Bretton Woods institution provides loans to banks at commercial rates for further lending to SMEs.
"The banks which meet lending targets are offered financial incentives," Moses said.
He noted that SMEs are the engine of job creation in Kenya as the majority of Kenyans are employed by small businesses.
"Our interest is in financing SMEs so that they expand and increase their role in the economy," he said.
IFC's current portfolio in Kenya is close to one billion dollars, which is invested in sectors such as the financial sector, schools, manufacturing health and infrastructure.
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