Equity Group Holdings to Support SMEs with New $ 684 Million Loan Facility
Wednesday March 3, 2021, Kenya’s Equity Group Holdings announced the launch of a loan facility worth 75 billion Kenyan shillings ($ 684.62 million) targeting small and medium-sized enterprises (SMEs). The objective is to boost the activities of SMEs in the country after the economic impact of the COVID-19 (coronavirus) pandemic. The facility would make funds available to businesses, as the bank understands that many of them have depleted their working capital due to the pandemic.
At a press conference in Nairobi, James Mwangi noted that for SMEs that have been bankrupt for a year, working capital has run out. James Mwangi is Group Managing Director and Group CEO Equity Group Holdings Plc. The banking conglomerate has one of the largest customer bases on the African continent with more than 14 million customers as of December 2019.
As in most societies, SMEs spearhead job creation while stimulating economic expansion. According to a report, 80 percent of jobs created in the Kenyan market in 2014 were dominated by SMEs. The informal sector is estimated to account for 98 percent of businesses in Kenya, contributing 30 percent of jobs and 3 percent of Kenya’s GDP.
Three months after the global lockdown triggered by the pandemic, Kenya has recorded more than one million job losses. The pandemic has crippled its tourism, manufacturing and agriculture sectors, which represent jobs and economic activity.
Before the pandemic hit, small businesses were already facing a number of challenges in the East African country. Some of them include limited financial support, mismanagement, corruption, lack of training and experience, poor infrastructure and insufficient profits. The latest installation will therefore make financing available to small businesses while boosting the economy.