The British High Commission in Nairobi has launched a $5.2 million (KSh 667 million) funding initiative to support Kenya's micro, small, and medium-sized enterprises (MSMEs) through the "Listed SME Debt Fund."
This fund, led by FSD Africa and backed by the UK government, aims to raise $300 million (KSh 38.85 billion) to offer affordable financing options for Kenya's SMEs, fostering growth and job creation nationwide.
Initially targeting $100 million in investments, the fund will attract Kenyan institutional investors, especially pension funds, to diversify their portfolios while supporting local economic development.
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The fund’s primary goal is to aid over 10,000 MSMEs, create or safeguard around 89,000 jobs, and improve essential services for over 200,000 people.
This initiative aligns with Kenya's economic objectives and highlights the UK's commitment to promoting long-term economic growth and resilience.
Kenyan SMEs currently face high borrowing costs, with interest rates reaching up to 40%, constraining growth and limiting job creation. The Listed SME Debt Fund aims to empower Kenyan entrepreneurs by providing more affordable credit and strengthening industries from agriculture and manufacturing to financial services.
The fund also introduces a new asset class, allowing pension funds to diversify by investing in alternative assets.
Neil Wigan, the British High Commissioner to Kenya, emphasized the UK’s commitment to supporting Kenyan businesses and reducing borrowing costs for economically marginalized groups, including women, youth, and people with disabilities.
Mark Napier, CEO of FSD Africa, highlighted that SMEs comprise 98% of Kenyan businesses and contribute roughly 24% of the GDP, making them essential for Kenya’s economic transformation.
Through this fund, Kenyan SMEs gain access to financing that enables them to expand locally and across borders, contributing to sustainable economic growth and job creation.
