NAIROBI, Kenya, Mar 23- Equity Group Holdings (EGH) has signed a Sh11 million loan facility to support its expansion across Eastern and Central Africa, enhancing its ability to serve small and medium enterprises.
In addition to operating in 7 African countries – Kenya, Rwanda, Uganda, South Sudan, Tanzania, the Democratic Republic of the Congo and Ethiopia – the Group has recently expanded its operations in the DRC by merging its existing operations of Equity Bank Congo with its acquisition of BCDC to form EquityBCDC, now the second largest financial services company in the country.
At the signing, James Mwangi, Managing Director and CEO of Equity Group Holdings said, “Together with the African Development Bank Group, Equity Group will be strongly positioned to support MSMEs to keep their lights on during the prevailing COVID-19 pandemic that has slowed down the economy impacting on the cashflows of enterprises. By extending credit to them during this period, Equity demonstrates its commitment to walk with its customers, and to empathize with their social economic situation brought about by the pandemic.” Mwangi added, “We have seen the impact of pumping oxygen to our MSMEs during this period. They have been able to re-imagine, repurpose and retool their enterprises and emerged more resilient thereby protecting jobs and creating more job opportunities through venturing into more innovative initiatives such as manufacturing of internationally certified quality PPEs.”
The loan, a tier two facility with a seven-year maturity, is expected to promote EGH’s ability to offer bespoke products to MSMEs, strengthen its balance sheet and optimize its capital structure across the continent with a special focus on women and youth entrepreneurs.
“EGH has a strong track record of designing products suited to the needs of SMEs as well as emerging corporates. The timing of the facility’s disbursement could not have been more appropriate especially as businesses seek to remain operational during a COVID-19 pandemic that is causing financial havoc,” said Stefan Nalletamby, AfDB’s Director for financial sector development.
“We are very pleased to collaborate with EGH in playing a countercyclical role during this pandemic.”
Equity’s prudent approach to conserving its cashflow and supporting MSMEs through the COVID-19 crisis has provided more comfort to lenders across the continent and its partnership with the African Development Bank will now facilitate further financing of MSMEs.
This is the sixth tranche for Equity Group after having signed a $50 million USD (Sh5.5 Billion) loan facility with IFC in September; a $100 million USD (Sh11.0 Billion) from Proparco in October and a EUR 125 million (Sh 16.5 Billion) loan facility signed last week with the European Investment Bank, a US $100 Million (Sh11 Billion) Credit Facility with Leading European Development Banks DEG, FMO and CDC-UK and a USD 75 Million (Sh 8.25 Billion) Loan Facility with the African Guaranty Fund to fortify credit flows and liquidity to MSMEs totaling Sh 63.25 Billion.