Branch MFB(Micro-Finance Bank), Kenya’s pioneering digital bank, and Solv Kenya, a B2B marketplace for micro, small, and medium enterprises (MSMEs), have established a strategic partnership that aims to provide loans, offer business development support, and create market connections for Kenyan MSMEs.
The collaboration seeks to address the credit gap and provide guidance for MSMEs, helping them grow and contribute to the economy. Under the agreement, Branch MFB will offer loans and working capital of up to Kshs. 1 million to MSMEs on Solv Kenya’s platform, facilitating their cash flow and stock financing from suppliers and distributors.
During the partnership announcement, Rose Muturi, Managing Director of Branch East Africa, emphasized the importance of digital financial services in addressing liquidity challenges for MSMEs. She highlighted that the partnership goes beyond providing instant digital loans to entreprises. It is about empowering MSMEs with market linkages and support to foster sustainable businesses and bolster Kenya’s economic growth.
“Access to credit facilities and business support is key to unlocking the full potential of our MSMEs. The partnership is a significant step forward in achieving this goal. By combining our expertise, we will provide Kenyan entrepreneurs with the comprehensive support they need to scale their businesses and contribute to a more vibrant Kenyan economy,” Muturi said.
Solv Kenya’s platform covers various supply chains, including food, consumer goods, construction, alcoholic beverages, animal feeds, electronics, airlines, and travel. MSMEs involved in these industries can access stock financing from Branch MFB through Solv’s digital platform.
African Lead SC Ventures and Chief Executive Officer Solv Kenya Dan Karuga, explained that the partnership helps mitigate lending risks for MSMEs while opening them up to a diversified portfolio across different supply chains.
“This partnership is a perfect alignment of our technological expertise and a testament to the power of collaboration in driving innovation and growth in Africa’s digital economy. We are confident we will unlock new capital streams for SMEs, enabling them to scale efficiently. Together, we aim to reach out to more MSMEs and offer them convenient and affordable credit solutions that suit their needs,” Karuga said.
MSMEs are pivotal contributors to economic growth in Kenya, constituting 98% of all business entities in the country. However, the sector remains predominantly informal, with only 20% of the over 7.4 million MSMEs operating as licensed entities.This partnership aims to provide financing solutions for these MSMEs, often excluded from the formal economy.
Matt Flannery, CEO of Branch International, reiterated their commitment to working with industry players to provide financial solutions. He emphasized the importance of supporting MSMEs, as they create employment opportunities for marginalized individuals, including women, persons with disabilities, and those with limited education.
“At Branch, we remain committed to cooperating with other industry players to offer financial solutions. Our partnership with Solv Kenya creates a significant embedded financing solution for MSMEs,” Branch International CEO, Matt Flannery, said.
The sector provides enormous opportunities for socio-economic transformation, welcoming individuals with limited skills and economic opportunities, including women, persons with disabilities, and those with limited educational backgrounds.