Choice Microfinance Bank in drive to raise Sh60 million for expansion

Diaspora-backed Choice Microfinance Bank is set to raise Sh60 million by selling new shares to investors to enable it fund a planned nationwide expansion.

The Central Bank of Kenya licensed Choice Microfinance Bank (MFB) as a community microfinance bank in May last year allowing it to mobilise deposits and service Kajiado County.

The micro financier’s chairman, Ben Kamiri, said in a circular to members that it needs to raise enough capital to convert her licence from community to national bank.

“We need Sh60 million. Investors can still buy shares: 1,000 shares are going for Sh350,000 and that means you can buy in multiples of a minimum 200 shares at 70,000. We shall close once we get the needed Sh60 million,” Mr Kamiri told investors.

As a community microfinance bank, Choice required a lower minimum capital of Sh20 million compared to Sh60 million required for MFBs conducting business across the country.

The institution was started by a group of Kenyans living in the US and seeks to facilitate investment of diaspora funds into small and medium size enterprises (SMEs) in the marginalised areas of Kenya.

Many locals have taken up stake.

The Rongai-based micro lender became the 11th MFB to be licensed in the country. The Central Bank of Kenya has been pushing for financial inclusion, which is seen as key in improving economic opportunities available to communities.
Kenya’s financial inclusion is among the highest in Africa at 67 per cent, but some segments have been left behind.

This year, the CBK stopped the issuance of banking licences citing supervision capacity constraints after the collapse of three banks but has continued licensing micro-lenders.