Through the United States Agency for International Development’s (USAID) Pay for Performance initiative under the Kenya Investment Mechanism program, Family Bank has committed Sh 6 billion to provide affordable financing to agribusinesses in 17 counties.
For the next year, the program will focus on businesses in Homa Bay, Migori, Kisumu, Siaya, Kakamega, Bungoma, Busia, Vihiga, Kitui, Makueni, Taita Taveta, Isiolo, Marsabit, Turkana, Garissa, and Wajir counties, as well as their surrounding areas.
Agricultural issues, according to Family Bank CEO Rebecca Mbithi, continue to stymie progress despite the sector’s importance to the country’s economy.
“As a bank, we see the financial need for agribusinesses to scale climate-smart agriculture technology to improve agricultural value chain climate resilience,” added the CEO.
According to Kenya’s Ministry of Agriculture, climate change has exacerbated weather-related risks such as droughts, floods, pests, and illnesses, exposing farmers to significant losses.
According to government estimates, the economy lost Sh 1.33 trillion due to intense drought between 2008 and 2011, with the livestock sub-sector accounting for 72 percent of the loss.
“Agriculture is not only essential for our food supply; it is also the bedrock upon which we create communities that are more robust and better prepared to deal with crises.” “As a Bank, we are committed to expanding our support to businesses, particularly those in the agriculture sector, through both inexpensive loans and capacity building to ensure sustainability,” Mbithi added.
The bank had already granted Sh 500 million to agribusinesses under a similar program earlier this year, as part of USAID’s drive to unlock Sh 40 billion for SMEs in Kenya and East Africa.
Kenya Investment Mechanism is a USAID program that, in collaboration with banks and other financial institutions, unlocks money for SMEs and smallholder farmers in Kenya and East Africa.
Palladium, a global firm that works with foundations, investors, governments, corporations, communities, and civil society to develop strategies and implement solutions that have long-term social, environmental, and financial advantages, is implementing the program.
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