Sidian Bank Wednesday said it had secured a nine hundred and ninety million shillings deal with the Netherlands based social impact investor, Oikocredit.
The funding will be utilized to support the bank’s growth plans to further its strategy of providing affordable credit to its SME clients and privately-owned business enterprises as it works towards empowering entrepreneurs realize their potential through providing tailor-made financial solutions.
“This is yet another footprint of the bank’s strategic initiative to be the preferred bank for trade finance solutions and SMEs, especially in view of the impact of the pandemic on SME businesses. We intend that the success of this partnership will impact SMEs ranging from small, medium and large,” Sidian Bank CEO, Chege Thumbi said.
Oikocredit which is a social impact investor and the worldwide cooperative has over four decades of experience in promoting sustainable development through investments and focuses on investments around financial inclusion, agriculture and renewable energy.
During the signing Oikocredit’s Investments Manager, East and Southern Africa Caroline Mulwa, noted that Oikocredit is excited to be part of Sidian Bank’s Growth, an institution that has demonstrated the ability to package trade solutions to the emerging SME clientele. This investment will enable the bank to lend more and thus contribute to the creation of sustainable jobs, which is in line with the mission of Oikocredit to create a lasting social impact on the low-income sections of society.
During the investment period, Oikocredit will work with the bank to mainstream social impact and its measurement into its lending activities.
According to our estimates, 600 million jobs will be needed by 2030 to absorb the growing global workforce, which makes SME development a high priority for many governments around the world.
In emerging markets, most formal jobs are generated by SMEs, which create 7 out of 10 jobs. However, access to finance is a key constraint to SME growth, it is the second most cited obstacle facing SMEs to grow their businesses in emerging markets and developing countries.