Central Bank Governor hails credit platform for SMEs

Kenya’s Central Bank Governor Dr. Patrick Njoroge has hailed the newly launched credit platform for Small and Medium-sized Enterprises (SMEs).

The platform, dubbed Stawi, is an unsecured digital credit scheme which is meant to improve access to credit for MSMEs, through offering unsecured loans from between KSh30,000 to KSh250,000 with repayment periods of 1 month to 12 months, at an interest rate of nine per cent per year.

“Today is really just the beginning for banks in scaling up support to MSMEs. A lot more remains to be done, not just through finance but also through capacity building, enabling access to markets, promoting innovation and most importantly through creating an enabling business environment,” said Njoroge.

Stawi rides on technology and innovation to provide a cost effective ‘anytime anywhere’ credit product that is tailored to the needs of MSMEs. The platform also aims at not just providing finance but also supporting them to enhance their credit worthiness, business skills and ultimately grow their businesses.

Over the last few years, Kenyans have expressed concerns on what they perceived as the alienation of banks from meeting their needs.

“Today’s event and launch is proof that banks have heard the cry of Kenyans. Over the last three years, banks have reviewed their business models to put the customer at the center. MSME’s have not been left behind and the variety of products targeting this sector and exhibited here today is welcome,” he said.

Adding that, “Earlier this year, the Central Bank of Kenya (CBK) made a deliberate effort to go where the action is to understand the needs of the MSMEs. We met vibrant traders in Gikomba, agile mechanics on Ogopa Lane, Kariokor, traders in the bustling Kondele Market in Kisumu, and creative furniture traders on Ngong Road. All of them need finance that is convenient, accessible and preserves their dignity as they may not fit the conventional brick-and-mortar bank model. In short, they need ‘anytime anywhere’ financial services that are aligned to the nature of their enterprises.”

MSMEs are the backbone of Kenya’s economy, contributing about 28.4 percent of the Gross Domestic Product. The approximately 7 million MSMEs are concentrated in the manufacturing, wholesale and retail trade, and transport and storage sectors.