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Platinum credit, sister firms get Sh1.3bn loan
The loan is meant to expand the financiers’ lending to small businesses in the region, especially women-owned ones and those working in climate-smart agriculture, increasing their access to formal credit.
Microfinance lender Platinum Credit’s parent firm Platcorp Holdings has received a $10 million (Sh1.29 billion) loan from Swedish development financier Swedfund to expand its lending to micro, small, and medium enterprises (MSMEs) in Kenya and across the region.
Platcorp Holdings Limited is the parent firm of lenders Platinum, Premiere, Momentum, Eezy, Viva, Fanikiwa, and Spectrum, which operate in Kenya, Uganda, Tanzania, and Zambia.
The loan, which is supported by a 50 percent guarantee from the European Union, is meant to expand the financiers’ lending to small businesses in the region, especially women-owned ones and those working in climate-smart agriculture, increasing their access to formal credit.
“Limited access to finance is a key constraint for small businesses in many developing countries,” Jakob Larsson, senior investment manager at Swedfund, said in a statement.
“This investment supports the expansion of financial services in underserved communities and contributes to Swedfund’s broader objectives of inclusive and sustainable economic development in low-income countries.”
This is the fourth time the Swedish financier has lent to Platcorp Group, the first loan of €10 million (Sh1.5 billion at current rates) having come in 2018, also meant to support its lending to small businesses across the region.
The lender added Platcorp another €5 million (Sh757 million) in 2020 to increase its loan book and sustain liquidity, and again a €15 million (Sh2.27 billion) in 2024 to aid its expansion efforts and boost lending to climate-smart projects.
“In connection with its investments, Swedfund has seen improvements in the company’s environmental and social risk management, including measures related to customer protection and gender equality,” noted the financier.
Platcorp’s director of corporate affairs Ignatius Obara said the additional funds will help it boost its financing for social impact in the region to aid gender empowerment and job creation.
“With this support, we will be able to channel more capital to women entrepreneurs, expand access to climate-smart agricultural finance, and continue strengthening our environmental and social practices,” said Mr Obara.
Other than this group of microfinance lenders, a number of Kenyan banks have recently received support from international development institutions to increase their lending to MSMEs, especially those owned by women in Kenya and across the East African region.
KCB Group, Equity Group, Co-operative Bank of Kenya, NCBA Group, and Stanbic Bank are among the banks that have recently signed deals to provide subsidized credit to MSMEs, with a particular focus on women-led enterprises.
