Entrepreneurship Industry News

There’s a cash windfall for small businesses

This is one of the best times to be an entrepreneur. If you’re looking for a capital boost to get a business started or to expand one, you’ve got several financing options set aside for small and medium enterprises to choose from. While there’s a definite interest in growing the SME sector, mobile money trends have also helped boost lending.

After years of experimenting with different business models and learning from the success of M-Pesa, foreign investors have now set their sights on mobile lending based on data patterns.

Financial service providers are shifting the country’s credit market, lending out billions of shillings to SMEs and low-income earners based on factors like smartphone activity. This means information such as how often and how much we transact on our mobile money accounts, who we communicate with, our location and more can be aggregated to create a credit profile. These are some of the credit lines made available by foreign investors to financial tech firms and commercial banks in Kenya for onward lending to small businesses.

Ksh 10 Billion: Kenya Commercial Bank and the African Development Bank announced a Sh 10 billion line of credit targeted towards small and medium enterprises.

Ksh7.5 Billion: Diamond Trust Bank has secured Sh 7.5 Billion from the African Development Bank for financing firms in trade, transport, construction and manufacturing sectors in Kenya, Tanzania, Uganda and Burundi where it operates more than 130 outlets.

Ksh 7 billion: Branch, a mobile lending app raised sh 7 billion in funding from Berlin-based lender CreditEase to power its expansion.

Ksh 6.5 billion: Tala secured sh 6.5 billion in an investment funding initiative to help in expanding its services in Kenya.

Ksh 300 million: Google has set aside sh 300 million for the next three years for its Launchpad Accelerator Africa programme which offers equity-free support to early-stage businesses to help them grow and scale.

Ksh 68 million: The Italian government will be disbursing sh 68 million through the E4Impact Accelerator programme, which aims to boost entrepreneurship in the country by mentoring businesses through expansion, boosting their revenues and providing market linkages.

Read More: The Standard