Contribution to Micro Small and Medium Enterprises (MSME)

Loans advanced by banks to MSMEs were KES 190bn in both 2017 and 2018. This is compared to a loan book value of KES 1.4trn and KES 1.5trn in 2017 and 2018. Accordingly, MSME lending represented 14% and 13% of total loan book of participant banks in 2017 and 2018 respectively. The lack of growth in MSME loan book is attributed to the interest rate cap which has made banks shy off from lending to MSME as a result of the higher risk profile of MSMEs.