Daraja Microfinance Bank (MFB) becomes the 10th microfinance bank (MFB) to be licensed following the licensing of seven nationwide MFBs and two community based MFBs.
Among the seven nationwide MFBs are Faulu Kenya MFB, Kenya Women MFB, SMEP MFB, REMU MFB, Rafiki MFB, Century MFB and SUMAC MFB and the two community based MFB include Uwezo MFB and U&I MFB.
Daraja MFB is a Kenyan owned company limited by shares and intends to operate within Dagoretti Division, Nairobi County.
The MFB’s target market is the Micro and Small Enterprises (MSE) and their owners and employees who reside or operate businesses in Dagoretti.
CBK says the entry of Daraja into the formal financial sector will encourage innovation, competition and increased outreach in enhancing the development of Micro, Small and Medium Enterprises financing and growth.
“CBK has thus been in the forefront in developing an all-inclusive financial system that reduces the impediments to accessing finance, including for MSEs. Further, the Central Bank has initiated, and will continually support, reforms to develop effective legal, regulatory and supervisory frameworks that support innovations to enhance the development of MSE financing and growth,” CBK says.
CBK adds that MSE which represent over 90 percent of private business and contribute to more than 50 percent of employment and of Gross Domestic Product (GDP) in most African countries, still remain a critical part of the economy.
These enterprises provide employment opportunities and contribute to economic growth and sustainable development. Nevertheless, they face a number of challenges, including access to finance, which is often considered to be their most significant challenge.