Kenya National Chamber of Commerce and Industry Thursday called for banks to raise lending to small businesses seeking to expand product lines and enter new markets on the back of disruptive coronavirus.
The appeal comes on the back of the chamber’s study showing majority of businesses are struggling to access credit since the onset of the pandemic mid-March last year.
The lobby’s president, Richard Ngatia said increased credit will allow businesses to diversify into areas such as personal protective equipment, online services, food retailing and logistics.
“I encourage banks to consider moratoriums and give loans to businesses to revitalise export markets,” said Mr Ngatia.
He was speaking during a forum to address challenges facing business on the back of Covid-19 that has led to the collapse of value chain.
The chamber’s study conducted between November and December had shown that 58.8 percent of surveyed businesses reported decreased access to financing options.
Reduced access to loans has slowed the ability of micro small and medium-sized enterprises (MSMEs) to reinvent themselves to avoid collapse owing to the disruptions of their markets and operations.
Small businesses want to re-establish markets and value chains that had been broken at the peak of Covid-19 control measures such as lockdowns and curfews.
Mr Ngatia said the loans will also help small businesses venture into cross-border trade through e-commerce, giving them new revenue streams.
Central Bank of Kenya data shows MSME loan book was at Sh638 billion last year.