Kenya: Standard Chartered Bank Empowering SMEs

By NewsfromAfrica 

Nairobi-- Standard Chartered Bank, in partnership with Pricewaterhouse Coopers (PwC), is equipping its SME customers in Kenya with basic financial management, effective working capital management and business planning skills to increase their capacity to access more capital and run their businesses profitably.

Humphrey Muturi, General Manager for SME Kenya at Standard Chartered Bank said: “Using our deep local knowledge of the SME customer base and leveraging Standard Chartered’s core business skills, we are working with PWC to train over 150 SMEs clients. This programme builds upon a similar initiative that IFC and Standard Chartered led in Kenya in 2010 and 2011 that saw 54 SMEs trained.” 

Small and medium enterprises are important drivers of economic growth.  Across Africa, SMEs contribute between 32 to 60 percent of GDP, with an average of 39 percent.  Yet, a significant number of SMEs lack expertise in areas such as accounting, cash management, business planning, human resource management and marketing.

Without these essential business skills, many viable companies with good products fail to reach their full potential, succumbing to competition and poor cash flow management. Most will face challenges in obtaining bank financing because they cannot produce the financial records required and may fail to make the most of the financing they do obtain.

To turn the situation around, Muturi suggests that banks and their SME Relationship Managers need to play a wider role in supporting SMEs, not just by providing credit, but by helping to build up the capacity and resilience of SMEs through non-financial services, such as training, consultancy, mentoring, networking and knowledge sharing.

“It is not enough to only provide innovative and tailored banking products to SMEs. To unlock their true growth potential, there is also need to support the development of business and management skills of small business entrepreneurs,” asserted Muturi.

At present, partnering with PwC – the bank has trained a total of 375 SMEs, in Ghana, Kenya, Nigeria and Zambia. Participating SMEs broaden their knowledge of financial statements and business planning. They also meet with the Bank’s senior managers, credit approvers and relationship managers, to gain a better understanding of the credit approval process.

One very obvious positive outcome of such training programmes is that the SMEs become more able to obtain financing to grow their businesses. More than half of the SMEs participating in our courses in Africa subsequently obtained new credit facilities. An average of 69 per cent also claimed to have improved their cash flow and general financial management.

Through this initiative the bank also aims to demonstrate its commitment to being an all-around long-term partner to its SME customers. The Bank has a long commitment of supporting clients of all sizes from SMEs, to Microfinance Institutions (MFIs) to local corporates and multinationals.