Formal and informal business owners will now benefit from a new financial service introduced by Cooperative Bank.
Coop Bank on Thursday rolled out the service aimed at supporting micro, small and medium enterprises(MSMEs) in accessing financial solutions segmented into silver, bronze and gold categories.
The new offer is part of the bank's commitment to ensuring that a minimum of 20 percent of its lending goes to the MSME sector.
Prior to the launch, the bank trained its staff across all branches on ways to effectively handle the MSMEs such that they are able to identify their different needs.
Staff at all Coop branches will endeavor to ensure they correctly match customers to relevant financial solutions under the new lending feature.
Coop head of Business Banking Moses Gitau indicated that there shall be more training for its staff to ensure businesses are supported to grow and expand their operations.
“We will rely on customer feedback throughout the country to add on to more training programs for MSMEs,” stated Mr Gitau.
The bank will now offer unsecured business loans and E-Credit through its M-Coop Cash App where businesses will be able to borrow up to Kshs2 million on their phones.
More to the packaged is an insurance cover handpicked and specifically negotiated to suit various segments of MSME customers.
Through the feature, it will be easy to access the banks’ revised and pre-approved limits on overdrafts and loans and other diversified financial solutions such as supply chain financing.
According to the KNBS 2016 survey, MSMEs contribute an approximated 28.5% of the economy while employing at least 6.3 Million people.
A majority of MSMEs raise funds through family or individually while 29.6 percent end up closing down over the shortage of funds.
Most MSEs seek financial aid for use as working capital, refurbishing their businesses or for making inventory purchases.
Several others opt for financial aid for non-business reasons or when seeking to start new businesses altogether.
The sector is largely dominated by wholesale and retail dealers that run repair of motor vehicles and motorcycles.
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