Market News

Women Fund calls up saccos to disburse cash

Women Enterprise Fund
President Uhuru Kenyatta shakes hands with members of Kiambu Women Enterprise Fund after handing over a dummy cheque at Ndumberi Stadium in Kiambu County on December 5,2018. FILE PHOTO | NMG 

The Women Enterprise Fund has announced plans to partner with savings and credit co-operative societies (saccos) to distribute its interest-free loans to entrepreneurs.

The semi-autonomous government fund says such saccos and women-owned institutions will then on-lend members on concessional terms.

Consequently, the fund has invited expressions of interest from saccos around the country to act as distributors of the cash.

“The Fund desires to partner with saccos, Cooperative Unions and Women owned institutions (with good credit history) having credit products and other financial services with a bias to women enterprises,” said the Fund in a notice posted on local dailies.

Distributing the kitty through saccos is aimed at introducing the solidarity lending model that allows a group to provide collateral or loan guarantee through a group repayment pledge to stem defaults.


It emerged in 2017 that majority of the groups that received soft loans from the government's various funds to promote their enterprises have defaulted on paying within the stipulated time.

Peer pressure

The incentive to repay the loan is based on peer pressure – if one group member defaults, the others make up the payment amount.

State funds provide an alternative to young entrepreneurs who lack collateral to access cheap funding.

The announcement comes at a time the State has begun the process of consolidating functions of six financial organisations into one body to eliminate overlapping roles.

The institutions targeted to form the mega development bank include the Kenya Industrial Estates, Uwezo Fund, Youth Enterprise Development Fund, Women Enterprise Development Fund, Development Bank of Kenya and Industrial Development Bank of Kenya.

The funds are a flagship programme of Kenya's Vision 2030 blueprint, which includes initiatives to enable women, youth and the disabled access funds to promote businesses and enterprise at the constituency level, thereby enhancing economic growth.