Business

Nakuru County Government has inked a deal with Stanbic Bank aimed at offering training and affordable financing to over 2,000 Small and Medium Enterprises (SMEs) within the devolved unit. Governor Lee Kinyanjui further revealed that his administration was partnering with the bank to train 18 Information Communication Technology (ICT) experts on how small and Medium Enterprises (SMEs) businesses can sell their products online. Speaking at the County headquarters when he signed a Memorandum of Understanding with the financial institution, Mr Kinyanjui noted that though most SMEs had been adversely affected by Covid-19 economic aftershocks, affordable financing remained a challenge due to high interests offered. “We urge other financial institutions to realign their programmes by assisting traders adapt to the new reality caused by Covid-19 pandemic. Though SMEs are the driving force of economic development in Nakuru County, accounting for 90 per cent of all businesses, 50 per cent of employment, and 40 per cent of Gross Domestic Product, access to affordable financing services remains a challenge to many,” noted the Governor. He indicated that lack of sufficient collateral, high cost of credit, and an informal business structure had rendered most SMEs ineligible for financing, a situation Mr Kinyanjui noted had been worsened by the Covid-19 pandemic. “With reduced turnover and Covid-19 disruptions in the market and supply chains many Small and Medium Enterprises are unlikely to attract affordable and quality credit under the traditional arrangements,” Mr Kinyanjui added. He was flanked by Trade and Industrialisation Chief Administrative Secretary Lawrence Karanja, Stanbic Foundation Chief Executive Officer Pauline Mbayah, Stanbic Bank Chief Executive Officer Charles Mudiwa and Deputy Governor Dr Eric Korir. Others present were County Executive Committee Member for Education Francis Mwangi, his Agriculture, Fisheries and Livestock Counterpart Dr Immaculate Maina, County Attorney Caleb Nyamwange and Chief Officer Information Communication Technology (ICT) Peter Mwaura. The 18 ICT officers will be equipped with skills to train SME entrepreneurs on online marketing opportunities, record keeping, productivity and quality management, business registration and legal issues among others. Mr Kinyanjui stated there was a growing need for entrepreneurs to join the digital market to expose Kenyan goods to the global market. He called on the dominant small and micro enterprise sector in the country to exploit the increased online purchases for growth. “Now more than ever, we need to be innovative to help cushion businesses from the impact of Covid-19 pandemic. We will commit resources to support the initiative, to train vendors and give them the tools to sell online effectively. Our partnership will also ensure that more youth, women and bodaboda operators will be empowered through digital learning which will expose them to the global market and ideas,” stated Mr Kinyanjui. Ms Mbayah said the bank will provide free online training ranging from the basics of e-commerce to operations, marketing, finance and sales to youth and women in business as a way of countering Covid-19 disruptions. She affirmed that partnership targets to empower women, youth and persons with disabilities through financial support for their enterprises as a way of reducing poverty and increasing household incomes within the devolved unit. “Our collaboration shall focus on providing affordable loans or credit for business capital, provide skills and business development, facilitate technology acquisition and provide technical assistance in product and market development. There exists growth opportunities for entrepreneurs in the country in the e-commerce industry. However, there is a need for policy makers to address factors such as high taxes and costly prices of data in some markets, made worse by relatively low income levels,” observed Ms Mbayah Mr Karanja revealed that a third of SMEs in the country that needed funding failed to secure loans. “My Ministry conducted a survey which established that 33 per cent of small businesses had their loan applications either rejected, or opted not to apply due to high interest rates, collateral requirements and complex application procedures,” said the Chief Administrative Secretary. He added “According to the World Bank report on SMEs entrepreneurs, women make up nearly half of all Small and Medium Enterprises owners and 40 percent of smallholder farm managers, yet they have less than 10 per cent of the available credit and less than one per cent of agricultural credit,” Mr Karanja urged Women and youth in small and medium-sized enterprises to embrace technology in looking for new markets, and communicating with stakeholders and potential clients. “Online trading can help to make more goods and services available for consumers, increase market access for SMEs and encourage investments”, said the Chief Administrative Secretary. Source: Kenya News Agency

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