Big Kenyan banks 'turning attentions to SMEs'
A number of larger banks in Kenya are increasing their focus on the country's small and medium-sized enterprises (SMEs).Business Daily reports that both Standard Chartered Bank and KCB are looking to double their loan portfolios to less-sizable companies in 2011.
Peter Munyiri, Deputy Group Chief Executive at KCB, said: "We have been studying the risk matrices of lending to [SMEs] and are now ready to offer them credit even without collateral - and we know that carries a higher risk".
However, this means smaller financial institutions that currently target firms in this sector as niche clients may not be able to compete with the bigger players due to their limited infrastructure.
The Kenyan SME market is thought to account for up to 65 per cent of the country's economy.
KCB, which is focused on ensuring it has a global reach as well as being the preferred banking institute in Africa, stated that it wants to increase its SME loan book to Sh18 billion (€145 million) this year.