Unaitas Sacco on Monday, July 12, announced a new partnership with Dutch investor Oikocredit International that will see Kenya's Small and Medium Enterprises (SMEs) in retail and agricultural sectors receive Ksh1 billion capital injection.
The money will be payable over a period of six years and will be disbursed to over 5,000 individuals and firms across the country.
More specifically, funds target those in the agricultural and agri-business value chain. They include individual farmers, consortiums of producers, suppliers of inputs such as tools and fertilizers, as well as those dealing in transport and logistics.
In addition to farmers, smaller traders, investment groups (chamas) and retailers from other industries will be empowered by this money to unlock capital for their business ventures.
Oiko's primary concerns include providing access to low-income households and supporting the youth access gainful employment.
The money contributed is part of the efforts of the Dutch private equity firm in assisting enterprises and individuals to recover from the economic consequences of the pandemic. In the past year, multiple organizations and staff have been subjected to huge layoffs, pay reductions and redundancy.
At this time, interest rates have soared as a result of requirements by the Treasury. Unaitas, like other fiscal institutions, will exercise standard scrutiny and due diligence of those who wish to access financial boosting.
Many Kenyan enterprises have experienced difficulty both in raising funds and sustaining operations, thereby decreasing their qualifications for loans. They were forced to adopt more minimalistic approaches to stay afloat.
Multiple lenders consequently altered their lending practices. They adopted more risk-sharing approaches, especially the use of guarantees. This move was to indemnify their exposure to risk while lending to afflicted Kenyan companies.
However, the sacco is looking to overlook these extremes and instead rely on its rich track record with the lending international creditor, Oikocredit International.
It will provide financial solutions and sustenance for borrowers who would have been rejected by other local lending facilities. The two have been partners since 1997 when the former acquired Ksh 40 million. Oikocredit has for long promoted financial inclusion in Kenya through Unaitas Sacco.
Unaitas is a deposit Savings and Credit Cooperative (SACCO), licensed under the SACCO Societies Act, 2012.
It was first registered on 14 May 1993 as a cooperative society under the moniker Murang’a Tea Growers. These were agriculturalists who pooled their resources to save and access loans at affordable rates.
On the other hand, Oikocredit International is a global cooperative and social investing company headquartered in Amersfoort in The Netherlands. The firm and Unaitas have had a cohesive relationship spanning over two decades, in which the former has cemented its value proposition in Kenya.
