October 23rd 2017

Business / News

NBK targets the unbanked with new SME account

Some of the products that National Bank has launched under this unit are the Jenga Chama, Jenga Kilimo and Jenga Biashara plus loan accounts to fast-track its Small Enterprise banking outreach campaign.

By Soilan Kenanaskenana@kenyafreepress.comFriday, 14 Oct 2016 18:43 EAT

The National Bank of Kenya has launched its Small Enterprise Banking Unit, a move that will see the bank accelerate its balance sheet growth while catering for the financial inclusivity requirements for small enterprises.

This launch follows the bank’s pledge of Sh2 billion to support small enterprises across the country through the Kenyan Bankers Association (KBA) Inuka Programme. National Bank managing director and CEO Wilfred Musau said the Small Enterprise Banking Unit seeks to bank the unbanked in the majority of low-end Kenyans who are in business.

“We want to instill in small enterprises who, with proper access to financial services, can boost job creation, increase household incomes and increase investments in human capital,” said Mr Musau.

The new unit will target both personal business and investment groups in the Retail Conventional and Amanah Business Segments.

In the past three years, National Bank has embarked on an aggressive drive to diversify its deposit and loan concentrations by tapping the small and medium enterprise segment. According to the Kenya National Bureau of Statistics, there are more than 17 million small enterprises registered in Kenya, with 98 percent of the enterprises contributing to 25 percent of the country’s GDP and employing up to 50 percent of the workforce.

Some of the products that National Bank has launched under this unit are the Jenga Chama, Jenga Kilimo and Jenga Biashara plus loan accounts to fast-track its Small Enterprise banking outreach campaign.

Jenga Chama loan is designed to avail financial solutions to investment groups of three members and above that meet the group’s specific needs and provide financial advice to the groups that suit the current business environment under Asset financing and capital expenditure whereas Kilimo Loan is a financial solution that promises smallholder farmers: growth, diversification and consolidation of their farming business.

National Bank is the first financial institution to come out strongly focusing on Small enterprises sector since the capping of interest rates. Through this move, the bank has dispelled any fears that the sector is at risk of exclusion from formal banking due to the perceived high risk associated with small enterprises.

Mr Musau said that the move was part of the bank living up to its founding objective of offering affordable financial services to all customers. Through a specific tailored Jenga Biashara Plus business loan, the bank will cater for the financial needs of Enterprises that are seeking to expand their operations through both working capital and investment financing.

“We are looking at a massive and aggressive account opening campaign for our Small Enterprises banking segment while at the same time becoming the go-to bank for the unbanked and low-end customers who are “the backbone of our economy,” said Mr Musau.

In 2013, National Bank embarked on an aggressive mission to transform itself and reach top-tier status by 2017 through business growth, distinctive client service and operational excellence. The bank has so far implemented more than 50 projects in a bid to achieve its target.

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