Barclays Bank woos small businesses with targeted training

Listed lender Barclays Kenya #ticker:BBK says it is working on loan products tailored to the needs of Kenya’s small businesses after a nationwide survey revealed that most small and medium enterprises (SMEs) lacked credit facilities that understood their business model.

“We are engaging individual SMEs with a view to providing the type of product that reflects their needs. SMEs need training on bookkeeping as many were owner-run,” Barclays Kenya business banking director Elizabeth Wasunna-Ochwa said.

The lender reckons that its teams stationed across 36 counties will help the businesses deliver to larger firms.

“We are in discussion with large businesses that rely on low-end SMEs for goods and services where our sole intention is to support the low-end businesses with loans to improve their processes via purchase of equipment to fulfil contracts awarded to them by the large players.

The lender announced flat earnings of Sh1.9 billion for the three-month period ended March, as costs of rebranding to Absa ate into its bottom-line.

This is after a rebranding expense of Sh243.4 million, without which the lender’s first quarter net profit would have grown nearly 10 percent.

Its total interest income grew 7.1 percent to hit Sh7.4 billion as the loan book expanded 9 percent to Sh180.4 billion.

The lender is only the latest to increase its focus on SME lending, a segment that was hardest hit when banks constricted lending following the rate cap law.

Five commercial banks recently unveiled a Central Bank of Kenya-backed loan product targeting SMEs that would see businesses access unsecured loans ranging between Sh30,000 and Sh250,000.