Equity Bank Group has received a Sh11 billion credit from the African Development Bank AfDB) for operational expansion in East and Central Africa.
In a statement, Equity Bank said the amount will also boost its ability to serve small and medium enterprises (SMEs) in the region.
The lender recently entered the Democratic Republic of Congo after merging Equity Bank Congo with its acquisition of BCDC to form EquityBCDC, now the second-largest financial services provider in the country.
The loan, with a seven-year maturity, is expected to promote Equity’s ability to offer tailored products to MSMEs, strengthen its balance sheet and optimise its capital structure across the continent.
The group currently has operations in Kenya, Rwanda, Uganda, South Sudan, Tanzania, DRC and Ethiopia.
The amount comes barely a week after the group signed a Sh16.5 billion loan facility with the European Investment Bank (EIB) and the European Union (EU) to support small businesses.
Besides the loan, the lender received a €20million(Sh2.6billion) grant to foster capacity building on the borrowing clients to lower the risk of default, hence allowing affordability by the adoption of low-risk priced interest rates.
James Mwangi, CEO of Equity Group Holdings said together with AfDB, they are strongly positioned to support small businesses to keep them afloat during the prevailing Covid-19 pandemic that has slowed down the economy.
This comes the same day, Central Bank of Kenya the Kenya extended loan restructuring by commercial bank borrowers to July 3 offering a further three month relief.
“We have seen the impact of pumping oxygen to our MSMEs during this period. They have been able to re-imagine, repurpose and retool their enterprises and emerged more resilient thereby protecting jobs and creating new ones,” Mwangi said.
AfDB’s director for financial sector development Stefan Nalletamby welcomed the deal saying it will help mitigate the effects of Covid-19 pandemic on businesses.Since last September, Equity has received a total of Sh63.25 billion to support SMMEs.