KENYA – Financial institution Family Bank and the United States Agency for International Development (USAID), have partnered disburse US$4.7 million to agri-businesses in seventeen counties in Kenya in the next one year.
The partnership deal between the lender and the United States Agency for International Development (USAID) seeks to unlock US$374 million to Small and Medium Enterprises (SMEs) in Kenya and East Africa.
The partnership will see Family Bank finance agri-businesses in the selected 17 Counties in the East Africa nation.
Through an initiative dubbed ‘Pay for Results’, the bank targets financing across dairy, horticulture, livestock and energy for agriculture value chains.
The Counties targeted include Homa Bay, Migori, Kisii, Kisumu, Siaya, Kakamega, Bungoma, Busia, Vihiga, Kitui, Makueni, Taita Taveta, Isiolo, Marsabit, Turkana, Garissa and Wajir.
“The agri-business sector faces challenges accessing affordable credit and technical support. Through this partnership, we will provide affordable credit and capacity building to our SME customers to nurture sustainable agri-businesses,” said Family Bank Chief Executive Officer Rebecca Mbithi.
She added that such private partnerships are essential, especially in the wake of the Covid-19 constraints on the Kenyan agricultural market, to ensure timely and continued operation of the food supply chain.
The head of USAID’s Kenya Investment Mechanism, Roger Bird said the organization is constantly seeking partnerships with organizations eager to finance agribusiness.
The USAID-Family Bank partnership will enable creating new financing products that better fit the cash collection cycle of agribusinesses in the selected counties.
“The agri-business sector faces challenges accessing affordable credit and technical support. Through this partnership, we will provide affordable credit and capacity building to our SME customers to nurture sustainable agri-businesses.”Family Bank Chief Executive Officer – Rebecca Mbithi
Family Bank has a similar deal with Performeter Agribusiness and Ndumberi Dairy Farmers Co-operative Society in Kenya set to double dairy farmers milk production to 30,000 litres per day through a fodder financing agreement.
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.
This program by Palladium, a global firm, links with several organizations to formulate strategies and implement solutions that benefit farmers.
Kenya’s agriculture industry has recently been receiving financial boost from different organizations with the Co-op Bank, one of Kenya’s primary bank for agricultural cooperative societies, partnering with eco.business Fund to avail US$10 million financing for on-lending to sustainable agribusinesses.
This came weeks after Equity Bank received US$144m from the European Union and the European Investment Bank, to provide liquidity to Kenya’s small and medium-sized enterprises (SMEs), including the agriculture sector.
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