The government is intensifying efforts to unlock financing for micro, small and medium enterprises (MSMEs) by widening access to affordable credit and introducing tailored financial products for different categories of entrepreneurs.
Speaking at the Kenya Development Corporation (KDC) Customer Networking Forum in Nairobi, Principal Secretary for MSME Development Susan Mang’eni emphasized that bridging the financing gap remains a top priority as the state seeks to stimulate business growth and create jobs. She noted that Kenya’s entrepreneurial potential, especially among youth and emerging businesses, is immense, but limited access to affordable capital continues to stifle progress.
Mang’eni pointed out that many MSMEs are weighed down by costly loans and insufficient financing, leading to premature business collapse.
She called for increased funding for Development Finance Institutions (DFIs) from both government and development partners, while also exploring sustainable mechanisms to unlock public-sector financing. According to her, this approach would ensure financial solutions are better aligned with the unique needs of each borrower category.
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At the same time, the government wants enterprises that have benefited from DFI support for extended periods to transition to commercial banks. This, she explained, would free up concessional funding for newer businesses, preventing mature firms from clogging the system and limiting opportunities for other entrepreneurs.
KDC Director General Norah Ratemo revealed that the corporation is reviewing its collateral valuation model, shifting from forced-sale valuation to market value. She said the change will enable borrowers to unlock greater value from their assets, making financing more accessible.
The forum also showcased success stories of KDC-supported enterprises that are creating jobs, driving industrialisation, and transforming communities across Kenya, underscoring the impact of targeted financing in strengthening MSMEs.
By Masaki Enock
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