European Investment Bank: Supporting SMEs To Bridge The Gap Towards Equitable Access To Health In Kenya

In Kenya, millions remain locked out of access to affordable healthcare. While significant strides have been made in the country in recent decades, major disparities remain in access to quality healthcare services, leading to many suffering in silence or even losing their lives.

The underdeveloped healthcare systems in Kenya require radical surgery: solutions focused on innovation that can increase efficiency in service delivery. Equitable access to healthcare is not just a moral imperative; it’s a critical driver of socio-economic development. When people have access to preventive and curative services, they are healthier, more productive, and can better contribute to their communities. A healthy population fuels economic growth and reduces poverty.

The European Investment Bank (EIB) plays a crucial role as a catalyst of change in supporting equitable access to healthcare in Africa. As the European Union’s bank, the EIB leverages its resources and expertise to support countries like Kenya in closing the health funding gap by building resilient health systems based on accessible, high-quality primary healthcare.

The EIB is scaling up investments as it recognizes the need for increased financial resources to address the healthcare gap in Africa. It is committed to expanding its investments in health infrastructure, workforce development, and health systems.

One of the ways in which the EIB has been supporting the health sector is through availing funding to the private health sector players who greatly supplement the public health sector.

Insufficient access to credit for private-sector SMEs is widespread in Kenya. Businesses face high collateral requirements, which limits access to and the quantity of credit. SMEs typically face interest rates that are simply unaffordable given their business size and prospects.

The challenge of credit constraints is even worse for start-ups or relatively new businesses and those considered to be growing slowly. Many financial institutions consider these enterprises to be high risk, and consequently either exclude them or offer credit only at relatively higher prices.

It is against this background that the European Union (EU) and EIB have been working with stakeholders and local financial institutions to support Kenya’s private sector.

The EIB is a keen supporter of the private sector through intermediated lending. This means a local bank, or other financial institution, receives a loan from the EIB and then lends this money to small businesses in its area of operation. The credit lines are directed to the EU’s priority areas such as climate, clean energy, health, or private sector development, to maximize their impact.

With this arrangement, local financial institutions benefit from the EIB’s favorable financial terms including longer tenures and more attractive pricing compared to what commercial national banks can typically offer. The local financial institutions are expected to transfer this advantage to final beneficiaries such as private healthcare providers.

One good example of a private healthcare provider that has benefited from EIB’s partnership with local banks is Equity Afia. It has taken significant strides to address the issue of accessibility to quality and affordable healthcare, ensuring that even the most underserved populations have access to the medical services they need.

EIB, in partnership with Equity Bank, has played a significant role in supporting Dr. Anthony Kinyanjui who owns and runs the Equity Afia franchise branches in the Eastlands area of Nairobi, to access the finances he needed to expand his operations.

“We started with a few clinics but now the Eastlands area, for instance, is quite huge with a big population. One of the obstacles that we have been encountering is access to capital. Equity Bank has been able to educate us on the different options available for financing our businesses. When the opportunity to benefit from the European Investment Bank facility came, it came in handy, and we have been able to expand in every estate in Eastlands. We have been able to avail quality and affordable healthcare to more people as well as create more employment opportunities for the youth who are trained in healthcare,” said Dr. Anthony Kinyanjui, Medical Officer in Charge, Equity Afia- Donholm Branch.

Through EIB’s partnership with local financial institutions, the local banks have also shifted their focus from only the financial aspect to impact. They track how many sustainable jobs are being created, how many female enterprises or employees are being supported, and how they are increasing provision of healthcare services.

The EIB has been working with local financial institutions in Kenya for decades to support SMEs to thrive and will continue to do so. They are an important driver of the economic growth, helping to encourage entrepreneurial activity and reduce poverty. Paying particular attention to the activities of local financial institutions and SMEs like Equity Afia is, therefore, a step in the right direction for Kenya’s growing economy.

Equitable access to health in Africa is a collective responsibility. Through continued investment, innovative partnerships, and a focus on equity, a healthier future for all Kenyans is achievable.

Read Also: Equity Afia Expands Network to Increase Health Coverage