Co-operative Bank of Kenya has launched a Sh300 million enterprise fund with Laikipia County to offer affordable financing and business support to co-operatives and entrepreneurs.
The lender said the Laikipia Enterprise Fund would be scaled up based on the need.
The two parties have agreed for an interest-sharing and guarantee arrangement, meaning that the risk and return would be on shared terms.
Borrowers from the kitty will enjoy a single-digit interest rate after the county offered an interest subsidy of five per cent,
Co-op said the arrangement amounts to a lending rate of about 7.1 percent given that its loans currently averages 12.1 percent. Also, borrowers will enjoy a reduced appraisal fee at 1.5 percent of the loan amount.
The lender said it would also offer saccos consultancy to enable them to have sufficient liquidity and strengthen their management structures.
“In addition to financing, the bank will make available the full basket of services that include digital banking tools, workshops for business training, and capacity-building consultancy services for co-operatives,” said Co-op.
The fund targets about 7,000 entrepreneurs in the county in mitigation of Covid-19 woes.