Micro, Small, and Medium Enterprises(MSMEs) in the country have been urged to take advantage of the available financial solutions offered by banks to boost their businesses.
The announcement was made during the opening ceremony of the 2022 Inua Biashara forum, hosted by the Kenya Bankers Association, which brought together key financial industry players to explore measures that financial institutions, government agencies, and other key stakeholders can take to help MSMEs to scale up their businesses in efforts to help them recover from the adverse effects of the
Speaking during the event, Dr. Julius Muia, Principal Secretary at the NationalTreasury and Planning said that banks have enough financial products that if well utilized can revolutionize the MSME industry.
“Micro, Small and Medium-sized Enterprises are critical drivers of economic growth and contribute greatly towards poverty alleviation and employment creation in the country. However, this vital sector continues to face grave challenges that inhibit its ability to reach its full potential. One such challenge is their failure to access affordable bank finance. This was worsened with the advent of the health crisis in
2020. However, there are many financial solutions being offered by banks in Kenya which MSMEs need to take advantage of to boost their businesses.”
He also urged the small businesses in the country to take up affordable government business loans under the National Credit Guarantee Scheme launched in 2020.
“The National Credit Guarantee Scheme was designed to support micro, small and medium-sized enterprises to secure affordable credit with low collateral requirements from formal lending institutions. The Government, therefore, encourages eligible MSMEs to approach the participating banks in order to access these facilities. It is our hope that the participating lenders and borrowers will utilize this opportunity in the most responsible way to ensure that the objective of stimulating our economy and preserving and creating employment is realized,” added Dr Muia.
Dr. Muia further encouraged the banking industry to develop suitable, tailor-madefinancial solutions that address MSMEs challenges and help them reach their full potential.His sentiments were echoed by I&M Bank CEO Kihara Maina who encouraged MSMEs to apply for the Inuka Enterprise Program.
“Difficulty in accessing credit, whether from formal or informal sources,remains a significant constraint faced by MSMEs.The banking industry recognizes the important role that MSMEs play in Kenya’s Economic growth and to ensure that they actualize their full potential, the industry encourages MSMEs to apply and participate in the Inuka Enterprise Program that aims to empower micro-enterprises to formalize, small enterprises to professionalize their management and medium enterprises to optimize operations and increase their economic productivity. Our goal with this program is to enhance MSME’s ability to access finance from banks.So far, over 15,000 MSMEs are currently benefiting from the programme.” He further said that the banking sector will continue to work closely with the MSMEs sector to ensure its growth through platforms such as the Inua Biashara forum. “This forum has been a key platform that has enabled the banking sector to come up with great recommendations that are necessary to alleviate the adverse economic effects that medium and small businesses, are facing due to the pandemic. Therefore,going forward, we intend to hold this forum annually as we seek to elevate this important sector” The Inua Biashara Forum is a concerted effort by the banking industry under the Kenya Bankers Association to provide