Cooperatives & Micro, Small and Medium Enterprises (MSMEs) Cabinet Secretary Simon Chelugui has urged banks to increase the amount of funds set aside for MSMEs from the current Ksh3 billion.
Speaking during the closing ceremony of the one week pre-Madaraka day Cooperative and MSMEs expo held at the University of Embu, the CS said that while the government had hoped that the funding by banks would ease access to loans by various SMEs to spur economic growth, the uptake of such loans had been low due to strict lending regulations enforced by the Central Bank of Kenya.
He noted that the government was still in consultation with banks with hopes that borrowing packages would be restructured to be more attractive to MSMEs.
“The government will provide incentives to banks to enable them release funds as loans in a bid to aid Kenyans invest in various enterprises while embracing prudent and profitable management of their enterprises,” he said, adding that the government will also continue to seek alternative
funding packages without entirely depending on banks whose hands are tied by market price charges on loans.
The CS described exhibits in the expo, which was attended by Saccos, banks and other industry players, as largely innovative and educative.
He revealed that during tomorrow’s Madaraka day celebrations, Kenya would celebrate political and economic freedom because rules for easy access to loans had been restructured to make them friendlier to Kenyans of all walks of life provided they were registered as groups, Saccos and private companies.
“The president is expected to roll out the second phase of the Hustler Fund loans targeting registered groups. The packages, which have been restructured to range from Ksh20, 000 to Kshh200, 000 are bound to benefit more Kenyans,” said the CS.
Chelugui revealed that through various loan products, the government is committed to eradicate poverty, enrich Kenyans and industrialize the country.
He said in the first phase of the Hustler Fund, 22 million Kenyans borrowed Ksh28 billion out of which Ksh1.5 billion was set aside as savings.
Embu Governor Cecily Mbarire thanked the national government for facilitating the successful expo, noting further that the people of Embu and Kenyans in general had learned a lot about various facilities available for them from banks and other commercial entities.
She expressed confidence that the government will fulfill the commercial proposals by various stakeholders.
Mbarire heartily welcomed the decision by the Ministry of Cooperatives to launch campaigns to register cooperatives targeting macadamia farmers as a means of managing the marketing of the produce to stem abuse and exploitation by individual firms.
“Through cooperatives, farmers will start reaping well from their produce,” she said.
She also commended the ministry for accepting proposals by local farmers to have the Runyenjes KCC milk cooling unit upgraded to a full milk processing plant under a MoU agreement between the national and county governments.
By Robert Nyagah
