By Ongaga Ongaga
The Government is stepping up efforts to unlock access to affordable financing for micro, small and medium enterprises (MSMEs) through new funding models tailored to the needs of different categories of entrepreneurs.
Speaking during a customer networking forum for Kenya Development Corporation (KDC) customers and partners, Principal Secretary for Micro, Small and Medium Enterprises Development Susan Mang’eni said access to capital remains one of the biggest obstacles facing businesses, particularly youth-led enterprises and start-ups.
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She noted that the Government is prioritising solutions that expand financing opportunities through flexible lending rates and products designed for specific groups of entrepreneurs.
“There is huge potential among young people and growing businesses in the country, and the missing link has largely been access to funding,” said Mang’eni. “The Government is therefore keen on opening more doors for financing and supporting enterprise growth.”
The PS observed that many MSMEs continue to struggle under heavy debt burdens and inadequate financing, leading to the collapse of businesses at an early stage.
To address the challenge, the Government is pushing for increased financing of Development Finance Institutions (DFIs) by both public and private sector partners while exploring ways of unlocking more public-sector funding for businesses.
Mang’eni revealed that a proposal is under consideration to introduce a tiered financing model that would tailor financial products to different groups, including fresh graduates, young entrepreneurs, persons with disabilities and women.
She said the approach would help ensure that financing solutions respond to the unique needs of various segments of society.
At the same time, the Government is encouraging businesses that have benefited from DFI financing for extended periods to transition to commercial banks, creating room for younger enterprises to access funding.
“This has been a challenge and has clogged the system, denying other deserving businesses an opportunity to access financing,” she said.
KDC Director General Norah Ratemo announced that the corporation is reviewing its collateral requirements by shifting from valuation based on forced-sale value to market value.
According to Ratemo, the move is expected to improve access to credit by enabling more entrepreneurs to qualify for financial support.
The networking forum, held under the theme “Building Synergies for Sustainable Growth,” brought together KDC customers, Government officials and development partners to explore financing solutions, export opportunities, capital markets and business partnerships.
The event also highlighted success stories of KDC-supported enterprises that are creating jobs, driving industrialisation and transforming communities across the country.
Organisers said the forum marks the beginning of a continuous customer engagement platform aimed at strengthening collaboration between businesses, Government and development partners while improving access to financing, markets, strategic partnerships and advisory services.
