Chase Bank secures Sh5b for SME lending

chase Bank chief Executive Officer Paul Njaga (right) and AfdB regional director Gabriel Negatu signing the sh5b deal ByesterdaBy. [PHOTO: JENIPHER WACHIE/STANDARD]

NAIROBI: Chase Bank has secured a Sh5 billion on-lending facility from African Development Bank (AfDB) to support SME lending.

CEO Paul Njaga said the facility will strengthen the lender’s resolve in breaking funding challenges facing SMEs. “SMEs are the engine of growth. For the sector to grow, barriers to financial access need to be addressed. This partnership will support under-served clients,” he said.

The facility will add to the Sh60 billion that the bank had pledged to lend to SMEs during the Global Entrepreneurship Summit last year. According to the CEO, the bank has already disbursed loans amounting to Sh30 billion. The bank targets to lend out the remaining sum within three years.

Borrowers will be charged interest depending on their risk profile. Other beneficiaries will be those in building and construction, retail, transport, manufacturing and hospitality.

AfDB Regional Director for Eastern Africa Gabriel Negatu said that the partnership would stimulate economic growth by enhancing the capacity of entrepreneurs in Kenya. “The role of SMEs in economic growth cannot be over emphasised. SMEs provide over 80 per cent of employment opportunities and account for about 45 per cent of GDP,” he said.