- Banks are urged to measure MSME lending by its impact on jobs, businesses and livelihoods
- Fresh MSME lending reaches Ksh246 billion as banks target Ksh500 billion by year-end
- Lenders call for stronger data, smarter guarantees and more green financing for agriculture
Commercial banks have been challenged to shift focus from the size of the loans they issue to the difference that financing makes to businesses, employment and household incomes, especially among Micro, Small and Medium Enterprises (MSMEs).
Central Bank of Kenya (CBK) Governor Kamau Thugge made the call, telling lenders to design financing products around what businesses genuinely need rather than standard loan packages, so as to support economic activity that lasts.
Thugge noted that private sector credit growth had climbed to 10.4 per cent in August 2026, even as average commercial bank lending rates eased to 14.3 per cent, pointing to a gradual softening in the cost of borrowing.
Kenya Bankers Association (KBA) Vice Chairperson Betty Korir, who is also Chief Executive Officer of Credit Bank, said the sector had already disbursed Sh246 billion in fresh MSME loans by the middle of the year. Banks, she added, are working towards a Sh500 billion target in new MSME lending before the year ends.
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Beyond the numbers, Korir pushed for stronger data systems, smarter loan guarantees and closer partnerships to widen access to credit. She also flagged the need for greater climate resilience and green financing, singling out agriculture as a sector that cannot be left behind.
KBA Chief Executive Officer Raimond Molenje echoed the call for a shift in how success is measured, arguing that lending should be judged by the wealth, jobs and livelihoods it generates rather than the volume of credit disbursed alone.
“We need to look at the agriculture sector differently to have an impact and improve livelihoods,” Molenje said.
The discussions took place at the 15th Annual Banking Research Conference, hosted by the KBA under the theme “Banking Amidst Macroeconomic Policy Reforms: Emerging Risks and Opportunities.”
By Benedict Aoya
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