Equity leads in extending loans to MSMEs as banks surpass Ksh.150B target

Equity Bank led the sector, disbursing Ksh.90.7 billion, or roughly 28 percent of total MSME credit, reinforcing its dominance in small-business financing as demand for working capital and trade lines surged.

KCB followed with Ksh.56.2 billion, Co-operative Bank with Ksh.37.7 billion, Stanbic at Ksh.32.7 billion, and Family Bank with Ksh.32.0 billion. Together, the top five lenders accounted for about three-quarters of new MSME credit, underscoring the concentration of lending among major players despite rising overall demand.

Mid-tier banks also stepped up: I&M Bank advanced Ksh.26.3 billion, Kingdom Bank Ksh.9.8 billion, Absa Ksh.6.4 billion, National Bank Ksh.5.8 billion, and Sidian Bank Ksh.5.5 billion. These figures reflect growing competition for SME clients, with lenders increasingly offering supply-chain finance, invoice discounting, and sector-focused programs.

Analysts attribute the surge to a stabilising Kenya shilling, gradual easing of lending rates, and broader uptake of the public credit guarantee scheme, which has bolstered banks’ willingness to extend risk-weighted loans to small businesses.