New corporation targets to give SMEs Sh29 billion loans by 2024
A new State agency seeks to grow the loans advanced to SMEs in Kenya to Kes29.44 billion by June 2024 from the current Kes4.52 billion.
The ambitious plan was announced during the launch of Kenya Development Corporation‘s (KDC) strategic road map for the next three years ending 2024.
The launch of KDC plan marks the end of a 13-year journey of the government to create a strong single, cross-sector development finance institution, enabled with sufficient scale, scope, and resources to play a catalytic role in Kenya’s socio-economic growth.
KDC was established following the merger of three development finance institutions—Industrial and Commercial Development Corporation (ICDC), Tourism Finance Corporation (TFC), and IDB Capital Limited (IDB)—which was effected following a 2013 Presidential taskforce on parastatal reforms.
The new corporation seeks to address critical gaps in the market for long-term financing in sectors such as infrastructure, manufacturing, and agro-industry that cannot be met by commercial banks, the Treasury Cabinet Secretary Ukur Yatani noted.
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The corporation is also targeting SMEs in the blue economy, climate change, tourism, post-harvest management, health, and ICT sectors of the economy.
“Facilitating and enabling small, medium, and large-scale enterprises access to finance to grow is vital to sustainable socio-economic recovery and growth, especially post COVID-19. Over time, however, these enterprises have been financially constrained due to limited resources.
“Cognizant of this, the government, among other initiatives, has set up KDC to act as a one-stop-shop for financial and business advisory services for small, medium, and large enterprises,” KDC Board Chairman Michael Nyachae said.
In its inaugural strategic plan, KDC has identified five Key Result Areas (KRAs) that has heavily focused on ensuring ease of access to finance for Kenyan SMEs, timely business advisory services, and agility in operations for 1st class customer experience.
“We are here to create KDC of tomorrow, a corporation that will thrive in times of crises, good times, and hard times. We want to see KDC as a driver of the 4th industrial revolution, which is well positioned to be fit for emerging challenges,” said Head of Public Service Joseph Kinyua.
