The European Investment Bank (EIB Global) and KCB Bank Kenya have announced a Sh32.3 billion (€230 million) deal to support small and medium enterprises (SMEs), youth and women in Kenya.
Under the agreement, EIB Global will provide approximately Sh16 billion (€115 million) credit line to KCB, which will be matched by a similar €115 million from KCB’s own resources.
As part of the package, Sh4.1 billion (€30 million) will specifically support micro-enterprises run or owned by women.
In addition, the same amount will be allocated for working capital and new investments in SMEs, particularly those operated by women, in line with the 2X Challenge criteria.
A further Sh14 billion will target inclusive growth and youth employment, with a focus on businesses led or founded by young entrepreneurs or those that at least 40 percent of their workforce are youth. One-third of the funding will be dedicated to beneficiaries in the agricultural value chain.
“We are scaling our interventions to build a strong and vibrant SME sector to provide a solid foundation for lifting communities. We are increasingly addressing the barriers that hinder SME growth, and this funding will provide tailored financial solutions, business mentorship, and capacity-building initiatives to ensure that SMEs not only survive but thrive in the dynamic marketplace,” KCB Group Chief Executive Officer Paul Russo said on Thursday.
The Gates Foundation will provide technical assistance for the project and address a range of issues that limit women with low incomes from accessing finance – such as lack of collateral or credit history. This will help to cut the cost of loans to women through digital technology and risk sharing.
“Micro, small, and medium-sized businesses are the economic lifeblood of Kenya but are more vulnerable to crises than larger enterprises. The lack of adequate, affordable financing puts significant pressure on private lending, disadvantaging entrepreneurs and small companies. We believe this new partnership will help spur private sector growth, gender equality, youth empowerment, sustainable job creation, and poverty reduction,” EIB Vice President Thomas Östros said.
This funding is part of the Investing in Young Businesses in Africa (IYBA) initiative, which is supported by several EU Member States and their financial institutions.
IYBA provides not only capital for start-ups and early-stage businesses but also technical assistance and capacity building to ensure the sustainability and bankability of these businesses, thereby promoting long-term job creation.
KCB Bank Kenya already has a women-focused programme called Female-Led and Made Enterprises (FLME), which allocates Sh50 billion annually to support women entrepreneurs. This initiative is part of KCB’s broader strategy to support youth development and SME growth in Kenya.
