The International Finance Corporation (IFC), a member of the World Bank Group, has released U.S.$50million to support small and medium enterprises (SMEs) in Kenya.
Development Diaries understands that the SMEs have been severely affected by the economic challenges of Covid-19.
The funds, from the IFC’s Covid-19 facility, will be directed to Kenyan businesses across a range of sectors, according to the finance corporation.
The facility was launched in March to protect jobs and support businesses with working and trade-related capital as economies grapple with the challenges of the pandemic.
In April, the Central Bank of Kenya reported that SMEs in the country felt the adverse impact of Covid-19 more than larger companies in part due to their challenges accessing capital.
The World Bank Kenya Economic Update projects that Kenya’s gross domestic product will fall this year due to the negative impacts of Covid-19.
The U.S.$ 50million will be disbursed through Diamond Trust Bank Kenya Limited (DTB).
‘IFC’s partnership with DTB Kenya is part of our strategy to help businesses in Kenya manage the impacts of [Covid-19] so they can continue providing essential goods and services’, IFC Country Manager for Kenya, Manuel Moses, said in a statement.
‘IFC is committed to helping countries across Africa meet the unique challenges of [Covid-19] and also speed the process of recovery’.
The Managing Director of DTB, Nasim Devji, who underscored the importance of the funds, urged businesses in Kenya to take full advantage of the loan facility.
‘As an SME bank, we are aware that these businesses are among the hardest hit by the fallout of the pandemic’, Devji said.
‘This facility will enable us to support SMEs to address their cash flow challenges, which is a key concern as businesses need easy access to short-term liquidity.
‘We urge our SME borrowers to take advantage of the facility to ensure their survival during these tough times, as we remain committed to their development’.
IFC has earmarked two billion dollars of its eight billion dollars Covid-19 facility to the IFC Working Capital Solutions Programme to provide funding to emerging-market banks so they can help businesses shore up their working capital needs.
Source: IFC
Photo source: Meaduva
