Sumac Microfinance Bank and Jitegemea Credit Scheme are among the first microfinance banks and institutions in Kenya to be selected for a share of a credit rotation fund [CRF]which was set up recently by the Association of Microfinance Institutions – Kenya [AMFI-Kenya] in partnership with German Sparkessenstiftung Eastern Africa [DSIK].
“The objective of the credit rotation fund is to provide low-interest loans to financially sound and compliant institutions of the microfinance sector as additional liquidity to meet the demand for loans among our members during and after the Covid–19 pandemic with the aim of mitigating the negative impact on their businesses,” says AMFI-Kenya Chief Executive Officer, Caroline Karanja.
Eligible microfinance banks and institutions will have the opportunity to repeatedly apply for loans from the fund, to contribute to the support of economic activities in Kenya especially the establishment and development of micro, small and medium enterprises (MSMEs).
“For this reason, AMFI-Kenya has selected Sumac Microfinance Bank and Jitegemea Credit Scheme to be the first members to benefit from this fund,” Karanja said.
During a signing ceremony at AMFI-Kenya headquarters in Nairobi, Sumac Microfinance Bank Chief Executive Officer John Njihia noted that the fund will go a long way in assisting some of the lender’s MSMEs and agribusiness customers who have been adversely affected by the Covid-19 pandemic.
“We seek to cushion our customers in the best way possible, and this fund couldn’t have come at a better time,” Mr. Njihia said. “We are committed fully to ensuring we help the many businesses that have struggled a lot in the last one year or so,” he added.
On his part, Tonny Otieno, Country Director, DSIK , pledged full support to microfinance banks and institutions in Kenya, while noting that DSIK was absolutely committed to helping businesses in Kenya to get back on their feet.
“We are keen to see businesses emerge from the ruins of Covid-19 pandemic and that is why we set up this fund in partnership with AMFI-Kenya,” Mr. Otieno said. “DSIK intends to support financial institutions in Kenya by providing the support to push this agenda in foreseeable future. Our partnership with AMFI-Kenya will go a long way to help secure these objectives,” he added.
Laban Hihu Mwangi, Chief Executive Officer, Jitegemea Credit Scheme was elated as he signed the historic agreement. “Our goal is to continue offering affordable credit to our customers and with this gesture, we will have the muscle to help the ones who have been adversely affected by the Covid-19 pandemic,” Mwangi said.
Mr. Otieno is optimistic that the fund will grow exponentially in order to benefit all microfinance institutions and banks in Kenya. “Beyond that, we hope to attract more partners to the fund in order to have a broader mandate and capacity of strengthening businesses financially in the country.”