KENYA – Family Bank, a Kenyan commercial bank, has received Kshs. 1.1 billion (US$10 million) from the eco.business Fund to provide credit to sustainable tea producers across the country.
The credit facility will see sustainability-certified companies and smallholder tea farmers implement sustainable and climate-smart practices that will ensure long-term competitiveness of the agribusiness sector.
“This partnership is a testament to our commitment to supporting the growth of local markets, especially critical markets such as tea farming.
“It is through such strategic partnerships that we can support the sustainability and business continuity of SMEs in the agriculture, forestry, fishery and tourism sectors,” said Family Bank Chief Executive Officer Rebecca Mbithi.
Eco.business Fund expects the financing to help the country maintain a stable uptake of Kenyan tea on the international market on account of sustainable production.
Kenya is currently the third-largest tea producer in the world and is ranked the largest tea exporting country, representing approximately 22% of the global tea trade, reports KBC.
Last year, the country’s tea export earnings rose by 13.3% to Ksh 136 billion (US$1.2 billion) in 2021 from Ksh.120 billion (US$1.06 billion) registered the previous year.
“We are delighted by this new partnership with Family Bank. Together, we believe we can ramp up support to certified agribusiness in Kenya and ensure we contribute to biodiversity conservation, the sustainable use of natural resources and mitigate climate change and adapt to its impacts,” said Dr. Jens Mackensen, Chairperson of the Board of Directors of the eco.business Fund.
Family Bank is expected to finance sustainable agricultural value chains where financing gaps persist given its extensive branch network across the country.
The investment is further expected to support the fund’s overall mission to promote business and consumption practices that contribute to biodiversity conservation and climate action.
In addition, it is expected to contribute to the Sustainable Development Goals (SDGs) 2 on Zero Hunger, SDG 8 on Decent Work and Economic Growth, and SDG 12 on Responsible Consumption and Production.
Recently, the bank released Ksh. 6 billion (US$52.9m) to be extended as affordable credit to agribusinesses across 17 counties through the USAID’s Pay for Performance initiative under the Kenya Investment Mechanism program.
Kenya Investment Mechanism is a USAID program that unlocks capital for SMEs and smallholder farmers in Kenya and East Africa, in partnership with banks and other financing organizations.
The program is implemented by Palladium, a global firm that works with foundations, investors, governments, corporations, communities, and civil society to formulate strategies and implement solutions that generate lasting social, environmental, and financial benefits.
Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industry. SUBSCRIBE HERE
