{"id":78706,"date":"2024-10-16T13:56:37","date_gmt":"2024-10-16T13:56:37","guid":{"rendered":"https:\/\/www.kba.co.ke\/?p=78706"},"modified":"2024-10-16T13:56:37","modified_gmt":"2024-10-16T13:56:37","slug":"banks-commit-sh-150-billion-annually-to-support-msmes-financing-over-the-next-three-years","status":"publish","type":"post","link":"https:\/\/www.kba.co.ke\/site25\/banks-commit-sh-150-billion-annually-to-support-msmes-financing-over-the-next-three-years\/","title":{"rendered":"Banks Commit Sh. 150 billion Annually to Support MSMEs Financing Over the Next Three Years"},"content":{"rendered":"\t\t
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Nairobi \u2013 Wednesday, October 16, 2024<\/strong>: Members of banking industry umbrella body Kenya Bankers Association (KBA) have today committed KES 150 billion towards supporting Micro, Small, and Medium-sized enterprises (MSMEs) over the next three years as part of the banking sector\u2019s commitment to support MSMEs access more affordable credit to boost their growth and development.<\/p>

Speaking during the opening of KBA\u2019s 2024 MSME Summit and the release of the Banking Industry Total Tax Contribution Report 2023, KBA Chairman and NCBA Bank Group Managing Director John Gachora said supporting MSME growth is vital not only for economic development but also for poverty reduction through innovative business solutions.<\/p>

President William Ruto lauded the banking sector for committing to double its financial commitment to MSMEs, adding that the Government would lend its support to the sector through policy and institutional backing.<\/p>

\u201cI commend the banking industry\u2019s pledge to double lending to MSMEs by providing KSh150 billion in new loans annually, beginning 2025. Accordingly, the government will support this bold and innovative move through policy and institutional support, including measures to guarantee the prompt payment of all pending government bills, which will commence once the ongoing verification process is completed,\u201d said the president.<\/p>

The president also lauded the banking sector for its collective tax contribution of KES 825 Billion to the economy over the last five years (2018-2023), describing it as the backbone of Kenya’s economic growth and development agenda.<\/p>

“The banking industry’s tax contribution in the 2023 financial year alone stood at a record Ksh 190.26 billion, a clear demonstration of the sector’s commitment to supporting our national development goals,” President Ruto said.<\/p>

The President further called for collaborative efforts between banks and the public sector to enhance financing to the manufacturing sector to spur investments and growth.<\/p>

“I commend the banking sector for this bold initiative, which will undoubtedly unlock the potential of our MSMEs and propel them to greater heights,” he said. “By formalizing their operations and accessing credit, these enterprises will not only contribute to economic growth but also create much-needed employment opportunities for our youth.”<\/p>

National Treasury and Economic Planning Cabinet Secretary, John Mbadi, echoed the President’s sentiments, emphasizing the importance of a predictable tax environment to foster continued growth and investment in the banking sector.<\/p>

“The implementation of a national tax policy and clear tax laws will reduce litigation between taxpayers and revenue authorities, creating a more conducive environment for businesses to thrive,” Mbadi said.<\/p>

He further commended the banking industry’s efforts in supporting MSMEs through initiatives such as KBA\u2019s Inuka Enterprise Programme, which has trained businesses across the country, increasing their creditworthiness, operational efficiency, and resilience.<\/p>

Kenya Bankers Association (KBA) Chairman, John Gachora, reiterated the industry’s commitment to enabling MSMEs to formalize, access credit, and contribute to economic growth and job creation.<\/p>

“As an industry, we acknowledge that MSMEs play a crucial role in our economy, contributing about a third to Kenya’s GDP and providing 8 to 9 of every 10 job opportunities in the country,” Gachora said. “Supporting their growth, therefore, is vital not only for economic development but also for poverty reduction through innovative business solutions.”<\/p>

Gachora also highlighted the challenges faced by MSMEs, including pending bills estimated at Sh. 70 billion, which negatively impact supply chains, business viability, and bank lending. He called on the government to address this issue to ensure a healthier business environment for MSMEs to flourish.<\/p>

The 2024 Inua Biashara MSME Exhibition, themed “Accelerating MSME Development for Sustainable Economic Growth,” is geared towards empowering MSMEs and enhancing their access to tailored financial solutions. The event aims to strengthen engagement between MSMEs and the banking sector, promoting growth, innovation, and long-term sustainability.<\/p>

During the forum, the banking industry launched the MSME Accelerator Programme, which will provide mentorship, targeted financial literacy training, and market access interventions to help MSMEs scale their operations in collaboration with partners.<\/p>

The release of the Banking Industry Total Tax Contribution Report 2023 highlighted the sector\u2019s significant contribution to the national exchequer, with Ksh 73.05 billion paid in corporate taxes, Ksh 28.93 billion in pay-as-you-earn, and Ksh 23.81 billion in excise duty, representing 59.45 percent of all excise duty collected from the financial services sector.<\/p>

The report also revealed that for every Ksh 100 generated by the sector, Ksh 57.2 goes to the government in taxes, Ksh 27.8 goes to employees, and a further Ksh 15 goes to shareholders.<\/p>

With the banking industry\u2019s commitment to supporting MSMEs and its substantial tax contribution, stakeholders expressed optimism about the sector\u2019s ability to drive sustainable economic growth and development in the country.<\/p>

For media inquiries contact;<\/strong><\/p>

Novena Musyoka | nmusyoka@imgkenya.com<\/a> | 0727 563059<\/p>

Hesborn Nyakundi | hnyakundi@kba.co.ke<\/a> | 0725 562637<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t

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Nairobi \u2013 Wednesday, October 16, 2024: Members of banking industry umbrella body Kenya Bankers Association (KBA) have today committed KES 450 billion towards supporting Micro, Small, and Medium-sized enterprises (MSMEs) over the next three years as part of the banking sector\u2019s commitment to support MSMEs access more affordable credit to boost their growth and development.<\/p>\n

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