Family Bank in deal to fund water companies

Family Bank has partnered with international non-profit organisation Water.org to offer financing for water, sanitation and hygiene service providers.

The loan product, dubbed MajiPlus, will provide up to 80 percent financing with a maximum repayment period of 60 months. There will also be a moratorium of six to 12 months. The interest rate will be 13 percent on a reducing balance.

Family Bank has also partnered with Africa Guarantee Fund to provide loan security and aid more accessible collateral requirements.

A pilot for the product has seen Family Bank disburse Sh300m since 2016.

The loans target enterprises seeking to fund expansions to facilitate services such as rain water harvesting, storage, water distribution, borehole construction, construction of domestic and commercial biogas plants and improvement of sewerage systems.

According to Water.org, 19 million Kenyans lack access to safe water. Additionally, 27 million Kenyans lack access to improved sanitation.

“We understand the challenges facing the water sector and we are confident that this flexible solution will meet most if not all of these needs,” said Family Bank designate chief executive officer Rebecca Mbithi.

“It is our strategic intention to build a sustainable banking business aligned with the millennium development goals on clean water and sanitation.”

Family Bank picked Ms Mbithi as its new chief executive to replace David Thuku. Like the former CEO, Ms Mbithi is an insider of the home-grown lender, having served as a company secretary and director, legal services, a position she has held with the bank for the last four years.