IFC, a member of the World Bank Group, announced on January 11 that it will provide a $105 million loan to the Co-operative Bank of Kenya (Co-op Bank) to support lending to small and medium businesses, women entrepreneurs and the housing sector.
Co-op bank will use IFC’s financing to extend a wider range of financial services to entrepreneurs, with $30 million earmarked for women-owned businesses.
IFC estimates that close to 40% of Kenya’s SMEs are owned by women, who often have more barriers to gaining access finance than their male counterparts. Alongside the investment, IFC will advise Co-op Bank on how to tailor products to the needs of women entrepreneurs. Through IFC’s Banking on Women program, this project is supported by the Women Entrepreneurs Opportunity Facility, the first-of-its-kind global facility dedicated to expanding access to capital for women entrepreneurs, launched by IFC and Goldman Sachs’ 10,000 Women initiative in 2014.
Oumar Seydi, IFC Director for East and Southern Africa, said, ” Small and medium enterprises make up more than 95 percent of all firms in Africa, and are generating millions of jobs on the continent. IFC works with local financial institutions like Co-op Bank to provide innovative and specialized services to entrepreneurs, helping them grow their businesses and drive African economies.”
IFC’s new investment in Co-op Bank continues a relationship that began in 2012, when IFC invested $60 million to expand the bank’s SME portfolio and support the agribusiness sector. The current $105 million loan was mobilized in partnership with IFC’s Managed Co-Lending Portfolio Program, a new syndications platform that allows investors to passively participate in IFC’s future loan portfolio. The investment marks IFC’s first syndication under the program in Kenya.
IFC has partnered with ten banks in Kenya to support entrepreneurs and small business growth. During the last fiscal year, IFC’s work with financial institutions helped provide loans to two million entrepreneurs in Africa.