Supportive financial institutions contribute immensely to the success of businesses at their various stages of growth. A financial institution that is ready to walk with an entrepreneur from the start of his or her journey even when times become hard ( as they surely do) is a rare gem. Equity Bank has been a blessing to many businesses in Kenya and other African countries where it has a presence. The bank has distinguished itself as a port of call for both young and well established businesses. Equity understands the struggles most business go through because some years back, they too were in a similar predicament when they were a struggling Building Society.
SME a critical sector
Small and Medium Enterprises (SMEs) are a critical sector to the growth of Kenya’s economy. The sector is a major generator of employment opportunities and it contributes significantly to the growth of the country’s Gross Domestic Product (GDP). Nevertheless, SMEs grapple with many challenges in their quest for growth; top among them inadequate financing and inaccessible markets. Being aware of these challenges and in order to provide the necessary solutions, Equity Bank has over the years been working very closely with SMEs. To demonstrate this fact clearly, the sector takes up nearly 70 percent of Equity’s loan book.
The traditional process of applying and accessing loans from commercial banks is often time consuming and formal. In the event that an SME needs to acquire some goods or services fast, it might avoid taking that route opting instead to rely on its cash flow, irrespective of any limitations. Such a model often means that SMEs have to stagnate for a long time in their quest to grow to the next level. To address this challenge, Equity Bank (through Equitel or EazzyBanking App) offers digital loans dubbed EazzyLoans to SMEs ranging up to Kshs. 3 million.
In so far as the customer meets the necessary requirements, the process of applying and receiving an EazzyLoan is very fast – indeed, it is a matter of minutes. This allows SMEs to overcome cash flow challenges which if left unresolved, may lead to their stagnated growth. They are also able to spend more time on their core businesses as opposed to looking around for financiers.
The arrival of the fibre optic undersea cable in Kenya in 2012 was a game changer in the world of business. The cost of internet connectivity went down drastically allowing businesses to communicate easily, besides becoming more innovative and agile. Equity Bank has leveraged on this milestone by developing an array of innovative solutions. One of them is EazzyBiz – an innovative and cutting edge liquidity and cash management online product that enables SMEs and corporate customers holding multiple accounts with Equity Bank to gain visibility of all these accounts through the lender’s account module. It helps corporates manage credit and debit balances, cash flows across multiple accounts, currencies and locations, as well as management of deficits and excesses in various accounts.
Besides financing, Equity Bank trains entrepreneurs in the SMEs’ space in financial literacy, money management skills and advisory services by partnering with organizations like Norfund, International Labour Organization, MasterCard Foundation and the Lundin Foundation. Over 45,000 SMEs have been trained on entrepreneurship.
Equity is also a member of the SME Finance Forum, a global network managed by the International Finance Corporation (IFC). The forum aims at promoting the financial growth of SMEs.
Last year, Equity celebrated its 35th anniversary. The Bank started as a modest building society in Kangema (a small urban centre in Murang’a County). In its early days, it faced (but successfully overcame) many hurdles. The bank has been sharing these lessons with its SME customers and most of them have successfully grown to mid corporates and even large corporates. Examples include the Nairobi Institute of Business Studies (a fast growing tertiary college that offers technical and vocational courses) as well as Magnate Ventures (a leading outdoor advertising company).
The bank champions SME banking through the provision of customized, flexible and integrated banking services. These services are conveniently offered through its supreme branches. Currently sixteen in number, the branches target customers carrying out high value transactions in the SME and corporate market segment. The branches have very comfortable lounges and meeting rooms where customers wait or meet while waiting to be served. Customers also enjoy free Wi-Fi internet and extended banking hours during weekdays as well as weekends. Moreover, customers are assigned personal relationship managers to take care of their banking needs.
Equity Bank also organizes networking forums for its SME customers where they get an opportunity to meet, share experiences and learn more about how to run their businesses.
Equity Bank has been recognized internationally because of offering exemplary products and services to SMEs. For two years in a row (2018 and 2019), the tier one lender has emerged the African SME Bank of the Year at the Global SME Finance Award –Platinum Category. In 2018, the awards ceremony was held in Madrid, Spain, while in 2019, it was held in the Netherlands.
The prestigious awards are organized by the International Finance Corporation (IFC), a member of the World Bank Group and the SME Finance Forum. They are endorsed by the G20’s Global Partnership for Financial Inclusion (GPFI). The awards celebrate the outstanding achievements of financial institutions and fintech companies in delivering exceptional products and services to their SME customers.