Sidian Bank gets US$4.6m from AGF for SME loans

KENYA – Financial institution Sidian Bank has secured KSh500 million (US$4.6 million) from African Guarantee Fund (AGF) for onward lending to local Small and Medium Enterprises (SMEs).

The bank said the agreement is part of the effort to bridge the financing gap facing SMEs in the country and that the partnership would support the growth of small businesses through the provision of guarantees for the bank’s customer loan facilities.

The AGF Loan Portfolio Guarantee will enable Sidian Bank to scale up its lending activities to Small and Medium-sized enterprises through the provision of credit facilities.

“African SMEs face a greater challenge of accessibility over affordability for the loans they seek for their businesses. We hope this partnership will address that,” AGF chief executive Jules Ngankam said.

Sidian Bank chief executive Mr. Chege Thumbi said the bank was proud to be partnering with an institution that has a similar interest in SMEs.

AGF’s agreement with the bank is in line with their mandate to facilitate access to credit for SMEs in African countries and the Group plans to increase the guarantee to KSh5 billion (US$46.3 million) over the course of three years.

Mr. Ngankam said AGF was keen to see African businesses grow beyond financial success to achieve greater social impact.

“African SMEs face a greater challenge of accessibility over affordability for the loans they seek for their businesses. We hope this partnership will address that”

Jules Ngankam – CEO, Africa Guarantee Fund

“At Sidian Bank, we are excited to partner with AGF in this Loan Portfolio Guarantee Facility. AGF is a valuable partner; they are as passionate as we are about supporting SME growth and success in Kenya and Africa. This last year has been particularly difficult for SMEs, having to grapple with a lot of uncertainty. We expect that this guarantee facility and our other financial solutions will provide much-needed support to business owners and enable them to emerge stronger,” CEO of Sidian Bank Mr. Chege Thumbi said.

Sidian has been on the frontline in its support for SMEs across the country through a number of different instruments that seek to provide access to finance.

African Guarantee Fund’s objective is to support Small and Medium-sized Enterprises (SMEs), to play their role of engine drivers of growth and by closing the greatest obstacle, which is the financing gap, AGF enables SMEs to increase sustainable growth and to be a source of employment, skills and wealth creation. In turn, this serves to reduce poverty throughout the continent.

“Sidian bank provides efficient and convenient solutions to Kenyan entrepreneurs. Our loan portfolio guarantee will enable them to provide more financial solutions to their SME clientele especially in view of the impact of the pandemic on SME businesses. Most importantly, the guarantee facility will have an impact on thousands who are directly and indirectly dependent on the income generated from the SME beneficiaries,” Ngankam.

Sidian Bank is supporting entrepreneurs in the country through the provision of transformational financial solutions, targeting mainly the SME sector.

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