Stanbic Bank Kenya and the African Guarantee Fund for Small and Medium-sized Enterprises (AGF) on Tuesday signed a loan portfolio guarantee facility to increase financing for small and medium enterprises (SMEs) engaged in international trade.
Florence Wanja, the head of business and commercial clients at Stanbic Bank Kenya said in Nairobi, Kenya’s capital that the guarantee facility will provide a risk mitigation instrument for credit extended to firms engaged in international trade.
“Through the guarantee scheme, we will now be able to extend credit to small and medium enterprises without the need for collateral against the loans,” Wanja said, adding that most of their clients typically access loans of approximately 3 million shillings (26,000 U.S. dollars) for a period of two years.
According to Wanja, the credit facility will have a special focus on women-owned businesses.
Franck Adjagba, group director of business development AGF said that the partnership with Stanbic Bank will help to empower SMEs in recognition of the pivotal role that they play in economic development, innovation and job creation. The guarantee fund will offer technical capacity building to the SMEs that are eligible for the loans.
The fund is expected to impact thousands of SMEs across the country in the next 5 years. Enditem