The African Guarantee Fund (AGF) and Equity Group have signed a Ksh. 8.25 billion agreement to support women-owned SMEs in Kenya, Uganda, Rwanda, and DRC.
Speaking during the signing ceremony, Dr. James Mwangi, Managing Director, and CEO of Equity Group Holdings stated that the facility will
ensure the women-led businesses are able to easily access credit at affordable interest rates.
“With this facility from African Guarantee Fund, we will be strongly positioned to continue to offer our customers particularly women in business access to funding at a time when the COVID-19 pandemic continues to impact negatively on businesses. Women MSMEs are key players in driving livelihoods for the majority of families, communities, and growth of the economy,” the Equity boss said during the signing of the agreement.
In response to the COVID-19 crisis, Equity launched an offensive and defensive approach to support customers to sustain themselves while innovating alongside MSMEs who are leveraging on the opportunities that have presented within the crisis.
The Group committed to loan repayment accommodation for up to 45% of the customers whose cashflows and operation cycle were deemed likely to be negatively impacted during the COVID-19 pandemic. Equity made the prudent decision to ensure cashflow was not impaired and in its third-quarter 2020 results, reported a 30% growth in its loan book in support of its customers who saw opportunities of green shoots and diversifications in the COVID-19 environment.
Most of the new opportunities funded were in the manufacturing of PPE’s, logistics, online businesses, agro-processing, fast-moving consumer goods and agriculture value chains. Equity’s approach to conserving its cashflow and supporting MSMEs through the COVID-19 crisis has provided confidence to its lending partners.
“This partnership will foster sustainable development particularly for women-led/owned businesses who will be supported under our Affirmative Finance Action for Women in Africa initiative and green business who will be supported under our Green Guarantee Facility. Working with Equity Group indeed provides us with a broad opportunity to create impact alongside their various initiatives,” AGF Group CEO Jules Ngankam said on his part.
This is the fifth tranche for Equity Group after having signed a Ksh 5.5 Billion (USD $50 million) loan facility with IFC in September; a Ksh. 11 billion (USD100 million) from Proparco in October, a Ksh 16.5 Billion (EUR 125 million ) loan facility signed two weeks ago with the European Investment Bank and a Ksh 11 Billion (USD 100 Million) credit facility with leading European Development Banks DEG, FMO and CDC-UK to fortify credit flows and liquidity to MSMEs totaling Ksh 52.25 Billion.
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