Three counties take the bulk of small firms’ loans

Micro, small and medium enterprises (MSMEs) in Nairobi, Kiambu and Bomet counties have taken the largest share of loans advanced to the sector in the last three years.

Data from the Kenya National Bureau of Statistics (KNBS) shows that Sh457.1 billion was given to both licensed and unlicensed MSMEs in Nairobi during the period.

Those in Kiambu received a total of Sh42.9 billion loans, while those based in Bomet County were advanced Sh14.1 billion.

“Total amount of loan applied for by licensed MSMEs in the last three years was Sh707.3 billion out of which Sh644.1 billion was given, translating to 91.1 per cent,” KNBS data indicates.

“Out of total loans given to licensed MSMEs, Nairobi received the lion’s share at 70.3 per cent followed by Kiambu at 4.6 per cent.”

The total amount received by unlicensed MSMEs was Sh42.9 billion representing 92.3 per cent of loans applied.

Mandera, Wajir and Tana River counties received the smallest share of loans, with licensed MSMEs in Wajir County receiving only Sh3 million during the three-year period.

In Tana River County the MSMEs received Sh17.9 million, while in Mandera County licensed MSMES received Sh1.1 million with unlicensed businesses getting Sh91 million.

Working capital was the main reason given for taking loans at 37.0 per cent and 34.1 per cent by licensed and unlicensed businesses respectively.

Those who took loans to revamp their establishments were 24.9 per cent.

And 26.6 per cent of unlicensed establishments took loans for non-business purposes compared to 13.4 per cent for licensed businesses.