New fund to aid SMEs hit by post-poll chaos

The government is set to establish a revolving fund to assist small and medium enterprises whose businesses were destroyed during the post-election violence.

Chief economist in the Trade ministry Richard Sindiga said that a Cabinet paper has already been prepared to guide in the establishment of the fund.

The project being undertaken by the Industrial and Commercial Development Corporation, an institution within the ministry, would be allocated Sh500 million in the next financial year, said Mr Sindiga.

“The government has accepted to establish a revolving fund to assist SMEs that suffered during the post-election violence,” he said.

Mr Sindiga spoke during the Federation of Kenya Employers, Western Kenya branch 29th annual general meeting held in Kisumu last week.

Compensate traders

He, however, clarified that the fund would not be used to compensate traders who suffered in the chaos but as a form of soft loans to assist them start up again.

The repayment period, among other key details of the fund, are still under review by experts in the ministry to avoid any pitfalls that have dogged other revolving funds in the country today, he said.

Other funds set up by the government in recent years are the Women and Youth enterprise funds targeting the two groups respectively.

“We are ready to start distributing the funds to the SMEs as soon as the ministry gets the money from Treasury. The projection is to start the distribution in the next financial year,” said Mr Sindiga.

FKE national chair Patrick Obath in a speech read on his behalf by the organisation’s executive director Jacqueline Mugo said that the violence had seriously affected the business community.