Traders to benefit from new SME authority
Kenya National Federation of Jua Kali Association Chief Executive Officer Richard Muteti (second right) engages Trade Minister Moses Wetangula (second left) during the conference on Micro and Small Scale Enterprise bill. Small scale traders will benefit from a Sh3.8 billion fund after parliament passed the bill last December.
What you need to know:
- The funds are supposed to be disbursed to traders at about eight per cent interest rate but many banks have kept off financing start-ups or small enterprises, terming them high risk.
Small-scale traders will receive support directly from an authority to be established to oversee the micro and small enterprises sector.
The traders are set to benefit from a Sh3.8 billion fund to advance their operations through the Micro and Small Enterprises Authority that is to be established following passage of a law for the sector in December last year.
There have been challenges associated with accountability of funds channelled through commercial banks, according to Kenya National Federation of Jua Kali Association Chief Executive Officer Richard Muteti, but this could change when the authority is in place.
Track usage
“We don’t know the current status on usage of the funds. But, once the authority is established, we shall be able to track usage of the resources,” Mr Muteti said.
Previously, the funds were channelled through commercial banks through an arrangement that allows the banks to allocate a certain proportion of what the government sets aside.
The funds are supposed to be disbursed to traders at about eight per cent interest rate but many banks have kept off financing start-ups or small enterprises, terming them high risk.
