Want a cheap government loan? No problem as RUTO forms a new company to give small traders quick loans

 

Tuesday, March 12, 2024 - President William Ruto has initiated plans to form a new company to give loans to small-scale traders in the country.

This was revealed during the meeting between Treasury Cabinet Secretary Njuguna Ndung'u and his Cooperatives counterpart Simon Chelugui.

The two revealed that the new entity, whose establishment is now at an advanced stage, will be known as Kenya Credit Guarantee Company.

"The Company aims to boost credit access for MSMEs, crucial as the MSME sector contributes about 34 per cent of GDP and empowers about 15 million people," Treasury announced.

Once operational, the Kenya Credit Guarantee Company will provide credit guarantees, mitigating risk for lenders and encouraging SME lending.

The National Treasury insisted that the company will be vital for the majority of businesses in Kenya.

"The Financing gap for MSMEs is staggering, with banks only lending 783 billion out of a trillion," the National Treasury indicated.

Already, a task force has been forced to expedite the formation of the Kenya Credit Guarantee Company. The launch date and location will be published once a final report is presented by the task force.

The new company will supplement Hustler Fund which was launched by Ruto to support small-scale traders and saccos in the country.