Co-op Bank Launches Financial Solutions for MSME Customers

Co-operative Bank of Kenya has launched a packaged financial solution for Micro, Small and Medium-sized Enterprises (MSMEs).

The financial solution is categorized in bronze, silver, and gold for micro, small and medium businesses respectively. In the past one year, in partnership with the International Finance Corporation (IFC), the Bank has expended a lot of resources, customer engagements and research work to understand the dynamics of this critical business segment.

This sector forms the backbone of the Kenyan economy as over 90 percent of the Kenyan private sector consists of MSMES; with over 15 million Kenyans employed in either the 1.7 million registered businesses or 7 million unregistered.

Kenya’s economy is estimated to grow by 5.5percent boosted by the manufacturing and tourism sectors in 2018, according to the World Bank.

The government is focused on reducing expenditure, borrowing, bringing down the fiscal deficit and raising revenues which will provide a healthy environment for the implementation of the Big Four Agendas of affordable housing, food security, manufacturing and universal health care.

Co-operative Bank has committed to align itself with the regulator’s requirement of ensuring that a minimum of 20 percent of its lending goes to the MSME sector. To support the Government’s key agenda, the Bank will closely support MSMEs who are important in the realization of this agenda.

“The MSME customer of today is more exposed to emerging business trends that are both exciting and at the same time volatile; trends that are driven both by local as well as global dynamics. This customer, therefore, expects adaptive banking solutions. For us to remain relevant and meet the specific needs of this customer, we have had to re-engage, refresh and reposition our offering,” said Mr. Arthur Muchangi, Cooperative Bank, Director Retail & Business Banking.

The MSME financial solutions will offer unsecured business loans, E-Credit through the MCo-op Cash App where businesses will manage to borrow up to 2 million shillings through the phone, packaged insurance cover-handpicked and specifically negotiated to suit various segments under MSME, revised and pre-approved limits on overdrafts and loans, diversified financial solutions to include Letters of Credit, guarantees and supply chain financing.