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About the SME Support Facility

The SME Support Facility or enterprise development lending scheme will see banks commit Ksh 30 billion worth of capital extended to Micro, Small and Medium sized enterprises (MSMEs) at preferential rates (no more than 14 percent), fixed on a reducing balance basis for a two-year period.

Of the SME Support Facility, Ksh 10 billion will be allocated to women and youth-owned businesses.  

Leather Industry

How it Works

Each bank has set aside an allocation towards the Ksh30billion target. Banks will work with both existing and new MSME clients to disburse the funds via business loans that will be offered at the concessionary terms.

Business owners will be required to complete an application that is specific to the Inuka Enterprise program and meet the bank’s credit assessment criteria. Banks will mostly base their decision based on the applicant’s credit report and ability to repay the loan.

Click here to access the sample of Inuka Enterprise Customer application form. Banks will customise this form with on any additional information they may require.

Contact your bank’s SME team to apply for this SME Support Facility.

How it works

Who Qualifies for Inuka Enterprise? 

Poultry Farming

Both existing bank customers and new loan applicants that meet the criteria will qualify for the concessionary rate of 14%. Priority will be placed on borrowers with a good credit track record and can demonstrate that they are able to repay the loan within two years. (Note: After the two-year period, the market rates will apply.)

The maximum amount that can be borrowed by a customer under this facility is Ksh 10 million. This limit has been set so as to ensure that as many businesses as possible are able to benefit from the Inuka Enterprise Program.

The criterion for the facility is threefold, namely: general requirements; segment-specific (i.e. based on size of the business); and bank-specific requirements.

 The general requirements are:

  • The company / MSME must be engaged in the commercial production of goods or provision of services;
  • The Company Owner or major shareholder must be an officially-recognized Citizen of Kenya; and
  • The capital required must go towards the productive capacity of the business (e.g. working capital) and not be used for non-business related consumption.

How Does the Program Define SMEs?

There are various definitions of micro, small and medium-sized enterprises. The National Government in the Micro and Small Enterprise Act No. 55 of 2012 has defined micro and small businesses. The World Bank also has an international standard. Meanwhile, individual financial firms each have specific definitions based on their institutional requirements.

For the purpose of the SME Support Facility, specific indicators have been defined by a Working Group which included the KBA Secretariat, local and regional banks, entrepreneurs, Micro and Small Enterprise Authority, Ministry of Industry, Trade and Cooperatives, Kenya Institute of Management and Kenya Association of Manufacturers.

The SME Working Group defined the MSMEs as follows.

  • Micro Enterprise
  • Small Enterprise
  • Medium Enterprise
  • May Be Formerly Registered (but likely not)
  • Annual Turnover of less than / under Ksh 1 Million (Ksh999,999 and below)
  • General Workforce Size of less than 10 employees
  • Full-time/Permanent Workforce of at least 1 employee (who may be the owner) to 5 employees
  • At least 1 year in business operations
  • Formerly Registered
  • Annual Turnover of Ksh 1 Million to 50 Million
  • Asset Base of over Ksh 3 Million
  • General Workforce Size of 5 to 30 employees
  • Full-time/Permanent Workforce 2 to 20 employees
  • At least 2 years in business operations
  • Formerly Registered
  • Annual Turnover of Ksh 50 Million to 250 Million
  • Asset Base of over Ksh 4 Million
  • General Workforce Size of 30 to 150 employees
  • Full-time/Permanent Workforce 10 to 50 employees
  • At least 3 years in business operations

How to Apply

All banks are required to set aside an allocation for this program. Therefore, business owners that meet the criteria should contact the SME department of any bank.

Business owners should familiarise themselves with the criteria listed above, as well as the Inuka Enterprise Customer application form before contacting their bank. 

Measurement & Evaluation

Kenya Bankers Association (KBA) is helping the industry coordinate this program.

The capital to finance this program will not be centralised, therefore, banks must individually declare their allocation to KBA and report the progress made on a quarterly basis. Central Bank of Kenya will monitor the progress.

Our goal is to have preferential rate loans extended to MSMEs.