DEG, FMO, CDC Group and Team Europe have signed a $100m (Kshs 11bn) loan facility with Equity Group Holdings in its continued commitment to strategically walk with MSMEs during the COVID-19 pandemic.
This is the fourth tranche for Equity Group after having signed a $50m (Kshs 5.5bn) loan facility with IFC in September; a $100m (Kshs 11.0bn) from Proparco in October and a €125m (Kshs 16.5 Billion) loan facility signed last week with the European Investment Bank to fortify credit flows and liquidity to MSMEs totaling Kshs 44bn.
Supporting MSMEs is a long-term priority particularly as the segment remains under-financed and in need of patient capital.
The partnership is testament to the Development Finance Institution (DFI) community’s strategy of working closely together to support more private sector businesses, scale impact and improve millions of livelihoods.
Christiane Laibach, CEO of the DEG Management Board, said: “DEG is delighted to realize a further financing for Equity Bank, together with our European partners CDC and FMO. Through our cooperation we are contributing to supplying local SMEs with credit, which is particularly important and in demand at present.”
Seema Dhanani, Head of Office & Coverage Director, CDC, Kenya, added: "We are delighted to partner with DEG and FMO to provide much-needed capital to support entrepreneurs and SMEs in Kenya. Equity is a natural partner for the DFI community with its mission to change people’s livelihoods through empowering entrepreneurs. CDC has invested in Kenya for over 70 years and is committed to increasing the resilience of businesses, boosting inclusive growth, and contributing to the country’s long-term economic recovery.”
In response to the COVID-19 crisis, Equity launched an offensive and defensive approach to support customers to sustain themselves while innovating alongside MSMEs who are leveraging on the opportunities that have presented within the crisis.
The Group committed to loan repayment accommodation for up to 45% of the customers whose cashflows and operation cycle were deemed likely to be negatively impacted during the COVID-19 pandemic.
Equity made the prudent decision to ensure cashflow was not impaired and in its third quarter 2020 results, Equity reported a 30% growth in its loan book in support of its customers who saw opportunities of green shoots and diversifications in the COVID-19 environment. Most of the new opportunities funded were in manufacturing of PPE’s, logistics, online businesses, agro-processing, fast moving consumer goods and agriculture value chains.
Dr. James Mwangi, Managing Director and CEO of Equity Group Holdings, said: “The […]