NAIROBI, Kenya, Mar 14 – General Motors EA has entered into an asset finance partnership with Cooperative Bank that will see the bank’s MSME clients in the motor industry get 95 percent financing on Isuzu vehicles.
General Motors EA Managing Director Rita Kavashe says the partnership aims to assist their shared customers establish and sustain their businesses.
The 5-year financing deal allows Cooperative Bank customers to source only 5 percent of the cost of the asset with the bank paying the balance to be repaid within 5 years.
“Starting and sustaining a business in Keny is difficult. A recent study recently revealed that about 2.2 million SMEs have closed their businesses in the last five years because of difficulties. We, therefore, want to make life easy for our customers,” Kavashe said.
“73% of these SMEs were made up of motor vehicles and motorcycles repair businesses. To help reduce this, we have taken it upon ourselves to innovate ways that will make it easier for SMEs to access our products when they need it. This goes to show our commitment to the countryand a promise that Tuko Pamoja Safarini in their journey to success,” she added.
Apart from the 14 percent interest rate, another extra charge will be the 1 percent which will be used to process the loan.
Additionally, customers will get Sh300,000 working capital which they will be expected pay in a year.
“We admit that there is much more that is involved in running a business apart from owning the vehicle. Our customers will, therefore concentrate more on doing other things involved in running their businesses,” Cooperative Bank Retail Business Manager Maurice Motuma said.
The bank says it expects to tap into its 1 million MSME client base.
The partnership will not be affected by the Isuzu take over expected next month.