The National Treasury has reported that the Credit Guarantee Scheme (CGS) loaned Micro, Small and Medium businesses a total of Ksh. 4.12 billion by August 31st.
According to the treasury’s documents, the government has involved various banks in helping raise funds for the scheme, which totals to an initial seed of Ksh. 3.0 billion.
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The banks currently contributing to the scheme include ABSA Bank Plc, Credit Bank Plc, Diamond Trust Bank Ltd., KCB Bank, NCBA Bank Plc and Stanbic Bank Kenya. Treasury also hinted at giving space for more banks to help make the kit more helpful.
“As at 31st August 2022, the banks had leveraged the seed capital and lent Ksh. 41.12 billion,” said the treasury.
“The government has been working closely with the banks to deepen the impact of the scheme through continuous performance monitoring and capacity-building where necessary. Additional participating banks will be onboarded in the medium term to further increase the outreach of the scheme”
The exchequer noted that the scheme had achieved remarkable milestones, the key among them being the disbursement of the Ksh. 4.12 billion.
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“The scheme achieved the following results as at 31st August 2022: 2609 credit facilities amounting to Ksh. 4.12 billion were advanced to MSMEs; the credit facilities range from Ksh. 30000 to Ksh. 5 million, with an average portfolio size of Ksh. 1,580,135 and an average repayment of 25 months,” read part of the statement.
The ministry also stated that the scheme served businesses in more than 46 counties and there has been a steady growth in MSMEs since its inception”
The treasury says it resolved to come up with the scheme to curb the premature winding up of target businesses, which recorded an average period of 4 years from start to closure.
