Business

Guaranty Trust Bank receives Sh1.7b IFC loan for SMEs lending

Tuesday, January 25th, 2022 08:14 | By
A banking hall. Photo/PD/FILE

Guaranty Trust Bank Kenya has obtained a Sh1.69 billion loan from the IFC to boost its lending book as it targets small and medium enterprises.

It will prioritise lending to trade, consumer goods, pharmaceuticals, and manufacturing sectors, among others, helping them retain and create jobs, and strengthen their operations.

“To help Kenyan businesses access more financing, including those with cash flows disrupted by the Covid-19 pandemic, IFC has extended a loan to Guaranty Trust Bank (Kenya) Ltd, a subsidiary of the Guaranty Trust Group, for on-lending to local businesses,” IFC said in a statement.

The Sh1.69 billion loan is part of the Sh890 billion IFC Fast Track Covid-19 Facility launched in 2020. The facility is designed to support existing IFC clients in emerging markets affected by the economic fallout from Covid-19.

“The IFC loan will help the bank meet the working capital and trade-related needs of businesses, especially SMEs that are part of our core clientele,” said Olabayo Veracruz, Managing Director, GTBank Kenya.

“We hope to on-lend the facility to customers in the trade, FMCG, manufacturing, and pharmaceutical sectors primarily to fund working capital needs over the next year.”

Amena Arif, IFC Country Manager for Kenya said IFC is committed to supporting Kenya’s private sector, including strengthening its financial sector in order to help the country’s smaller businesses to access more financing.

“Our partnership with GTBank Kenya will deliver funds to businesses, allowing them to emerge stronger from the Covid-19 crisis,” he said.

Smaller businesses Pandemic-related disruptions caused Kenya’s real gross domestic product (GDP) to contract in 2020, with the country’s smaller businesses hit hard by supply chain disruptions and reduced economic activity.

Although Kenya returned to pre-pandemic growth levels in 2021, 2022 is also proving challenging and smaller businesses still need added support to weather ongoing uncertainties.

IFC is committed to supporting Kenya’s long-term economic growth. IFC’s investment portfolio in Kenya stood at over Sh94 billion as of June 30, 2021

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