The Star (Kenya)

Cab­i­net ap­proves credit guar­an­tee scheme for MSMES

- SHARON MAOMBO / Business · Finance · Infectious Diseases · Health Conditions · Uhuru Kenyatta · Kenya · Central Bank of Kenya · Central Province

The Cab­i­net has ap­proved the es­tab­lish­ment of a credit guar­an­tee scheme for mi­cro, small and medium en­ter­prises.

The scheme is part of gov­ern­ment’s in­ter­ven­tions to cush­ion MSMES from the ef­fects of the Covid-19 pandemic.

The de­ci­sion was ar­rived at in a meet­ing chaired by Pres­i­dent Uhuru Keny­atta on Thurs­day.

The gov­ern­ment aims to en­hance ac­cess to credit by mid-oc­to­ber for the fi­nan­cially con­strained small busi­nesses.

The pandemic has taken a toll on busi­nesses, low­er­ing the GDP and wors­en­ing un­em­ploy­ment. It is es­ti­mated at least 1.7 mil­lion have lost jobs dur­ing this pe­riod.

The Cen­tral Bank of Kenya in May warned that at least 75 per cent of SMES risk clo­sure for lack of funds.

The scheme will com­mence with an ini­tial seed cap­i­tal of Sh10 bil­lion to be re­leased in two tranches of Sh5 bil­lion in 2020-21 and 2021-22.

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