KBC Channel 1

Tag: SME’s

  • Demand for digital credit among SMEs on the rise

    Demand for digital credit among SMEs on the rise

    Small and medium enterprises are expected to continue leveraging digital lending platforms to stabilize their operations amid rising global geopolitical uncertainties.

    A survey by Tala indicates that amid rising cost of living, many SMEs have turned to digital lenders to boost their supplies to cope with changing consumer habits.

    “What we have seen is that households are operating under very high financial pressure and in response they are adjusting how they earn as well as how they spend and many are actually bridging their financial gaps by either borrowing, saving or even community support like chama and community support,” said Teddy Kahiru, User Insights Manager at Tala.

    The MoneyMarch 2026 by the firm indicates that 45pc of borrowers took loans for the purpose of securing supplies for their businesses, 37pc for education purposes while 23pc too loans to meet their daily expenses same as medical expenses.

    Due to the rising cost of living, 51pc of respondents reported an increase in their borrowing habits on account of the rising cost of living coupled with slow employment growth.

    The report indicates that borrowers whose main source of income is full-time employment continue to fall within the last three years, from 57pc in 2023 to 45pc this year, while that of business owners has risen to 28pc signaling the shift in income stability.

    “Even for these people who are starting their business, they are facing a bit of seasonality in terms of their income. Customers are not paying on time, there is up and down in restocking and that affects their cash flow and in the process becomes very difficult to manage their financials and this affects their resilience even in the short term and that is how they end up relying on credit to smoothen that income instability,” added Kahiro.

    With digital lenders now emerging as the suitable alternative to access short term credit for day to day business activities, industry players are now calling for collaborations in the financial technology space to strengthen consumer financial literacy.

    “Majority of Kenyans still don’t understand what it means to have a credit score. They don’t understand the value of positive listing and I think there is a lot of collaboration that can happen with credit bureaus and do a lot more education to consumers,” said Annstella Mumbi, Tala Kenya General Manager.

    The report shows that 91pc of consumers prefer digital lending apps for loans, compared to 28pc who prefer banks and 24pc who opt for saccos, family and friends.

  • Sidian Bank eyes Mt. Kenya SMEs in expansion drive

    Sidian Bank eyes Mt. Kenya SMEs in expansion drive

    Sidian Bank has announced plans to expand it’s small and medium enterprises lending in Mt Kenya region.

    This follows the opening of its 49th branch in Gilgil, Nyandarua County in what the lender says deliver financial services closer to underserved communities in agri-sectors and entrepreneurs in the region.

    “Establishing our presence here is therefore, not only strategic; it is purposeful. It reflects our commitment to bringing banking closer to the people, where businesses are thriving, and where communities are building their future. This launch is, a significant step in reinforcing our mission to be the Home of Biashara Banking,” said Chege Thumbi, Sidian Bank Chief Executive Officer.

    Speaking during the launch, Nyandarua County Governor Dr Moses Badilisha said the move by the lender marks a strategic move to depend financial inclusion and drive economic growth.

    “By supporting our farmers, traders, and small businesses with accessible credit and quality banking services, Sidian Bank is helping us unlock the full potential of our people and resources,” he said.

    The Tier 2 lender reported a first half net profit of Ksh 1.01 billion after a 92pc increase.

    “We do take pride in being a stable and growing financial institution, with a solid balance sheet of Ksh 76.5 billion, a loyal and expanding customer base, with deposits exceeding Ksh 60 billion. Our continued investment in innovative, secure, and reliable digital infrastructure ensures that we meet the needs of our customers wherever they are, and whenever they need us. All this is part of our broader vision of becoming a Tier 2 Bank by the end of 2025. This means we are not here for the short term,” added Thumbi.

  • Family Bank, EIB commit Ksh 14.5B credit to women, youth SMEs 

    Family Bank, EIB commit Ksh 14.5B credit to women, youth SMEs 

    Family Bank and the European Investment Bank Global are targeting to raise Ksh 14.5 billion to support lending to women and youth enterprises.

    EIB Global has committed Ksh 7.3 billion (€50m) million credit line to Family Bank with the Kenyan lender matching the balance to expand loans to Kenyan small and medium-sized enterprises (SMEs).

    “This partnership not only supports our 2025–2029 strategy to scale SME lending and deepen market segmentation but also enables us to better address the specific needs of SMEs across various value chains for sustainable growth and long-term value,” said Nancy Njau, Family Bank Chief Executive Officer.

    50pc of the financing will target businesses owned or run by women while a further minimum of 30pc will be extended to youth entrepreneurs.

    Family Bank says the credit line will strengthen it’s lending capacity to SMEs which currently make up at least 80pc of its customer base.

    Additionally, EIB Global will provide Family Bank with technical assistance to enhance its gender strategy and product offering.

    “The financing partnership we now have with Family Bank will inject much-needed capital into Kenya’s private sector to support businesses and create employment,” added Thomas Ostros, EIB Vice-President.

    The agreement signed during the second EU-Kenya Business Forum in Nairobi is part of the EU’s Global Gateway strategy to promote trade, manufacturing, agriculture, climate action and services, which are key priorities in Kenya.

  • SMEs challenged to leverage on technology for growth

    SMEs challenged to leverage on technology for growth

    Small and medium-sized enterprises (SMEs) have been challenged to leverage on technology and adopt industry networks to position their businesses better for growth.

    Industry players noted that for small businesses to flourish, adoption of technology is key as it helps in data management, enhanced protection against cyber threats, facilitates improved service delivery and enables access to modernized, easy payment systems.

    Speaking during a symposium on leveraging digital technology for growth and sustainability of SMEs at Mount Kenya University (MKU), the industry experts reiterated that technology fosters innovation which is significant in maintaining a competitive edge in the present-day business environment.

    Led by Prof. Deogratius Jaganyi, the MKU Vice-Chancellor, the stakeholders called on young entrepreneurs to use the available tools to kickstart marketing their products digitally.

    He singled out use of smartphones saying that most buyers no longer make orders physically and that use of mobile marketing strategies will result in higher conversion rates and customer loyalty and ultimately increased profits.

    On his part, Chief Executive Officer · Ellegant Credit Limited Dr. Harrison Mutegi revealed that most young entrepreneurs with brilliant ideas have been grappling with inadequate funding to convert their ideas into businesses.

    He further noted that most of them have been lacking the requisite knowledge of kickstarting their businesses adding that poor technological adoption has also seen most of them remain sluggish.

    Mutegi called on stakeholders to continue supporting start-ups saying that given the right environment, entrepreneurs have the capacity to turn-around Kenya’s economic situation for the better.

    During the event, students at higher learning institutions were challenged to pursue businesses and consider becoming employers at a time when the job market continues to shrink despite the high number of graduates churned out by universities annually.

    Dr. Mercyline Kamande, a researcher noted that businesses that embrace technology are able to remain competitive and resilient adding that in today’s digital era, only entrepreneurs with digital skills are able to thrive.

    She thereby called on young entrepreneurs to positively adopt digital technology to spur the necessary growth in their businesses.

    Students led by Shadrack Oguta, a Masters student in Business Administration called for further training among young entrepreneurs to foster economic growth.

    By helping youngsters venture into businesses, the students noted that more jobs will be created thereby helping solve the joblessness crisis that Kenyans have been grappling with.

    Kingdom Bank Thika’s Marketing Manager acknowledged the financial challenges SMEs face, particularly in loan repayment.

    He said the symposium served as a crucial platform for empowering SMEs and young entrepreneurs with digital skills, reinforcing the role of technology in driving economic sustainability and business growth.

  • Report: 68pc of Kenyan SMEs to invest in contactless payments

    Report: 68pc of Kenyan SMEs to invest in contactless payments

    Visa has announced the launch of a new report, ‘Value of Acceptance: Understanding the Digital Payment Landscape in Kenya,’ which reveals growth opportunities for digital payments, particularly among Small and Medium-Sized Enterprises (SMEs).

    The report highlights a thriving digital payments ecosystem in Kenya, with 84% of surveyed SMEs recognizing that investing in payments technologies is crucial to drive business growth. This positive outlook is reinforced by the fact that 68% of SMEs currently accepting digital payments plan to invest further in payment technologies, including contactless solutions.

    The report underscores a compelling opportunity to transition cash-only SMEs to digital payments by promoting their benefits. Currently, 56% of surveyed cash-only SMEs report losing business due to customers not carrying cash, while 91% facing cash-related security concerns such as robbery and employee embezzlement. Combined, these challenges highlight the potential of secure, convenient, and transparent digital payments.

    While cash remains a familiar payment method, the study reveals the advantages of card payments including increased convenience for customers, simplified accounting and sales management, enhanced business reputation, valuable insights into spending habits, and support for multi-currency processing.

    Kenya’s Digital Payments Momentum

    The report highlights Kenya’s accelerating path toward broader payment acceptance, with 40% of SMEs having adopted digital payments in the last two years. This momentum is driven by the recognition that investments in payment technologies, including card payments alongside mobile and digital wallets, are essential for business growth. SMEs cite convenience (40%), cost savings (38%), and improved efficiency (37%) as key drivers for adopting digital payments.

    While comfort with cash remains a barrier, the report reveals that nearly all digitally enabled SMEs (97%) still harbor cash-related security concerns. This presents a strong case for promoting digital payments as a safer and more efficient alternative. Furthermore, there is significant demand for enhanced security measures among businesses already accepting digital payments, with 71% expressing a need for secure B2B payment solutions and 69% seeking guidance on payment security best practices. The high satisfaction rate (69%) among SMEs already using financial technology further supports the continued expansion of digital payments in Kenya.

    “Kenya’s digital payments landscape is experiencing a dynamic growth, fueled by a rising preference for innovative payment methods and value-added services that provide enhanced security and streamline operations” Chad Pollock, VP and General Manager, Visa East Africa stated.

    “This shift presents a significant opportunity to boost both individual prosperity and broader economic development. By collaborating with our partners across the ecosystem, Visa aims to unlock the full potential of digital payments for all Kenyans, spanning individuals, merchants, and businesses of all sizes.”

    The value of digital acceptance for SMEs

    Digital payments are crucial for Kenyan SMEs, boosting revenue through a wider, increasingly cashless customer base, improving customer satisfaction with faster payments, and reducing operational risks by minimizing cash handling. Digital transaction records also provide valuable data that facilitates access to financing, thereby stimulating growth.

    Beyond direct benefits, digital payment adoption drives economic growth and financial inclusion, connecting the unbanked to the formal financial system and enabling access to savings, credit, and insurance. Research shows that the transition to the digital economy can generate 1-2% annual GDP growth; a mere 1% increase in card usage generates an average $67 billion annual increase in goods and services consumption across 70 countries and territories1.

    Visa: A Partner in Driving Digital Payment Adoption

    Visa is uniquely positioned to support Kenya’s transition to a more digital economy. As a trusted advisor and partner, Visa offers a range of capabilities to help governments, financial institutions, businesses, and technology providers enhance their digital payment acceptance maturity. Visa’s suite of solutions includes programs for specific merchant segments, innovations like Tap to Phone, Contactless Payments and Click to Pay, and resources for educating businesses about the benefits of digital payments.

    About the Visa Value of Acceptance report

    Visa’s ‘Value of Acceptance: Understanding the Digital Payment Landscape in Kenya’ report, conducted by 4Sight Research & Analytics, examines the current state of digital payment acceptance, exploring both opportunities and challenges. The findings are based on face-to-face interviews with Kenya’s SME owners/managers who are key decision-makers with respect to day-to-day business decisions.

  • Microsoft, Orange to support one million SMEs in digital shift

    Microsoft, Orange to support one million SMEs in digital shift

    At least 15,000 Small and Medium size businesses in Africa and Middle East will have to access latest technologies to help them grow.

    Through a partnership with Microsoft and Orange Middle East and Africa, the two multinationals target to reach at least one million small businesses in 17 African countries.

    Under the deal, Orange will leverage its wide distribution network to provide SMEs with easy access to Microsoft solutions such as Microsoft 365, Copilot, Azure, and Dynamics 365.

    The firms will also facilitate the upskilling of Microsoft experts within each country.

    “This collaboration with Microsoft is a significant step in our commitment to support the digital transformation of African businesses. By combining our network and Microsoft’s solutions, we can provide SMEs with the tools and guidance they need to thrive in the digital economy,” said Jérôme Hénique, Orange MEA Chief Executive Officer.

    SMEs will also have access to training, marketing, and sales support programs to enable SMEs to adopt and benefit from Microsoft Modern Work solutions.

    Additionally, the two firms will establish a joint steering committee to ensure the successful execution of the partnership, which will be monitored through key performance indicators.

    “SMEs are the engine of economic growth in Africa. By collaborating with Orange, we can help them adopt digital technologies and unleash their full potential to create jobs, stimulate innovation, and contribute to the economic development of the continent,” added Lillian Barnard, Microsoft Africa President.

    The collaboration aims to address the growing needs of SMEs as they undergo digital transformation, helping them to thrive in the digital economy.

  • World Bank commits to support SMEs, startups growth

    World Bank commits to support SMEs, startups growth

    The World Bank has partnered with the government to offer business support and investor linkages to Small and Medium Enterprises (SMEs) and local startups.

    Through the Association of Startup and SMEs Enablers of Kenya (ASSEK), enterprises will receive seed funding and tailor –made business programmes which will cushion them from risks and offer technical support.

    ASSEK Chief Executive Officer Mercy Kimalat said the association will support SMEs and Startups growth through provision of business training that will enhance their productivity and improve on the quality of their services and products.

    “We have transformed SMEs and Startups by matching them with the right coach and mentor to help them grow. This is done by ensuring they have access to international opportunities though the stakeholders that we have partnered with. This has enabled many to sell their services and products regionally and beyond,” she said.

    According to Kimalat, they have formulated a framework which will create incentives for local and international investors which will help fast track development of new products for the market.

    “The key objective of ASSEK is to boost job creation and growth, identifying emerging opportunities, and fostering an environment conducive to meaningful networking,” she added.

    The program has resulted in increased inclusion in the ecosystem, standardization of approaches, attraction of investment opportunities, job creation and value addition to local and international stakeholders enabling the scaling of the innovation space in Kenya

  • African Guarantee Fund bolster Sidian Bank lending capacity to SME’s

    African Guarantee Fund bolster Sidian Bank lending capacity to SME’s

    The African Guarantee Fund has bolstered Sidian Bank’s lending for small businesses, with a focus on women entrepreneurs .

    Under the risk-sharing guarantee facility, Sidian Bank plans to scale up its lending to small businesses with women-led businesses earmarked at least 30 percent of the amount.

    Sidian Bank has received an enhancement from African Guarantee Fund to bring its total loan portfolio guarantee to KES 1.5 billion.

    This enhancement of the portfolio guarantee limit is set to empower the bank to provide enhanced support to the Kenyan SME sector over a period of 7 years, commencing in 2023.

    Speaking at the signing ceremony, Mr. Chege Thumbi, CEO of Sidian Bank, expressed his enthusiasm for the partnership.

    “Sidian Bank has always been committed to supporting SMEs across the country,and this collaboration with the African Guarantee Fund marks a significant milestone in our efforts to provide accessible financial solutions.

    SMEs are the backbone of our economy, and we are dedicated to helping them thrive through various financial instruments designed to improve access to finance.

    This latest collaboration with the African Guarantee Fund further solidifies the bank’s commitment to the growth and prosperity of SMEs and increased contribution to the country’s GDP.”

    On his part, African Guarantee Fund Group Chief Executive Officer, Jules Ngankam said,

    “We are excited about this renewed partnership and the prospect of having an even greater impact in reducing the SME financing gap, which is still a major concern in this critical sector and has been linked to the widespread closure of these small and medium businesses.”

    “The additional facility gives Sidian Bank an extra security measure to expand its lending activities to SMEs, especially green businesses and gender-smart projects, and therefore fostering an inclusive and sustainable economic growth in Kenya” Jules added.

    AGF’s risk-sharing guarantee facility will enable Sidian Bank to scale up its lending activities to SMEs,ensuring that the businesses have access to the credit facilities they need to thrive.

    The African Guarantee Fund is a pan-African guarantee provider whose mission is to empower SMEs to fully play their role as engines of growth in the continent.

  • Africa Guarantee Fund bolster Sidian bank lending to SME’scapacity to SME’s

    Africa Guarantee Fund bolster Sidian bank lending to SME’scapacity to SME’s

    The African Guarantee Fund has bolstered Sidian Bank’s lending for small businesses, with a focus on women entrepreneur .

    Under the risk-sharing guarantee facility, Sidian Bank plans to scale up its lending to small businesses with women-led businesses earmarked at least 30 percent of the amount.

    Sidian Bank has received an enhancement from African Guarantee Fund to bring its total loan portfolio guarantee to KES 1.5 billion.

    This enhancement of the portfolio guarantee limit is set to empower the bank to provide enhanced support to the Kenyan SME sector over a period of 7 years, commencing in 2023.

    Speaking at the signing ceremony, Mr. Chege Thumbi, CEO of Sidian Bank, expressed his enthusiasm for the partnership, stating, “Sidian Bank has always been committed to supporting SMEs across the country, and this collaboration with the African Guarantee Fund marks a significant milestone in our efforts to provide accessible financial solutions.

    SMEs are the backbone of our economy, and we are dedicated to helping them thrive through various financial instruments designed to improve access to finance.

    This latest collaboration with the African Guarantee Fund further solidifies the bank’s commitment to the growth and prosperity of SMEs and increased contribution to the country’s GDP.”

    On his part, African Guarantee Fund Group Chief Executive Officer, Jules Ngankam said, “We are excited about this renewed partnership and the prospect of having an even greater impact in reducing the SME financing gap, which is still a major concern in this critical sector and has been linked to the widespread closure of these small and medium businesses.”

    “The additional facility gives Sidian Bank an extra security measure to expand its lending activities to SMEs, especially green businesses and gender-smart projects, and therefore fostering an inclusive and sustainable economic growth in Kenya” Jules added.

    AGF’s risk-sharing guarantee facility will enable Sidian Bank to scale up its lending activities to SMEs,ensuring that the businesses have access to the credit facilities they need to thrive.

    The African Guarantee Fund is a pan-African guarantee provider whose mission is to empower SMEs to fully play their role as engines of growth in the continent.