The World Bank has given Equity Bank a Sh5 billion loan for onward lending to small and medium-sized enterprises to help them recover from the economic disruption of the Covid-19 pandemic.
The funds are drawn from the World Bank’s Sh800 billion global facility through its investment arm, International Finance Corporation, and is expected to support SMEs in the manufacturing, health, trade, transport and consumer goods sectors.
“IFC’s loan, part of our business continuity management plan, will help Equity Bank extend much-needed support to our clients, particularly to SMEs in sectors hit hard by Covid-19,” said Equity Group Chief Executive James Mwangi.
“We have purposed to support and walk with them so that they can survive during this crisis, recover, and thrive after it.”
IFC Country Manager for Kenya Manuel Moses said their longstanding partnership with Equity Bank underscores their commitment to Kenya’s financial sector and the wider economy, especially during the current difficult economic times.
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“Keeping businesses solvent and protecting jobs are essential parts of IFC’s response to the unprecedented challenges of Covid-19,” he said.
The Covid-19 pandemic has disrupted trade and value chains in Kenya, across Africa, and around the world, affecting commodity prices, reducing foreign financing flows, and collapsing tourism revenues.
Small businesses are the lifeblood of Kenya’s economy, accounting for about 81 per cent of employment.
The new facility pushes IFC’s portfolio in Kenya to Sh1 trillion from Sh954 billion as at June 30, 2020, spread across the financial, manufacturing, agribusiness, services, infrastructure and other sectors.