Horticultural News January - February issue

By CATHERINE RIUNGU
Kenya’s leading
microfinance
leader Equity Bank
has received a Ksh
2 billion (Euro 15
million ) loan from the German
Development Bank (KFW) for
lending to small scale businesses.
The new cash will be loaned out
to small and medium enterprises
in Kenya, uganda, Tanzania,
Southern Sudan and rwanda.
Equity Bank CEO, james
Mwangi, said the money will be
lent out at interest rates ranging
from between 5 and 12 per cent
depending on the risk factor of
a particular SME. The loans will
come as a big relief to businesses
who currently have to pay interest
rates as high as 25 per cent. Dr
Mwangi said the small enterprises
targeted under the arrangement
are those involved in import and
export businesses.
The loan will be accompanied
by a financial contribution for
capacity development within
Equity Bank and for their
customers, “The funds provided
by Germany will be used to
expand and strengthen Equity
Bank’s lending activities towards
micro, agricultural and small
scale business customers as well
as the absorption capacities of
their customers and is designed
to provide for long-term
sustainability of this field of
40
businesses,” Dr Mwangi said.
The funds have been advanced
on behalf of the German
Federal Ministry for Economic
Cooperation and Development ,
and Equity Bank was earmarked
because of its vision “To be the
champion of the socio-economic
prosperity of the people of
africa” and its mission to “offer
inclusive, customer focused
financial services that socially and
economically empower our clients
and other stakeholders”
Equity Bank vision is in line
with KfW’s thrust, which is
the promotion of sustainable
economic development including
microfinance and the general
improvement in the supply of
financial services for ordinary
people and small scale businesses.
KfW has been active in this sector
in Sub-Saharan africa since the
independence of the african
countries.
Equity’s wide rural
outreach and regional
presence strengthened the
FINANCE
Equity Bank and Germany’s
KfW in Ksh2 billion deal for SMEs
The funds will be used to expand and strengthen
micro, agricultural and small scale businesses
H O R T I C U LT U R A L N E W S I j a n u a r y - F E B r u a r y 2 0 1 2
Dr James Mwangi, Equity Bank Group CEO
partnership since Germany is
a main supporter of regional
integration.
Most SME businesses are
currently not yet fully served
by the banking sector yet their
Equity Bank’s vision is in line with KfW’s
thrust, which is the promotion of sustainable
economic development including
microfinance and the general improvement
in the supply of financial services for ordinary
people and small scale businesses
success is a decisive component
in enhancing viable improvement
of the economic, social and
ecological development of the
region.
KfW is one of the world´s
leading and most experienced
promotional banks. Established
in 1948 as a public law
institution, KfW is owned 80 per
cent by the Federal republic
of Germany and 20 per cent
by the federal states. Its goal is
to combat poverty, secure the
peace, protect the environment
and climate and make
globalization fair. It has 70 offices
worldwide.