International Finance Corporation -Kenya

IFC works in Kenya and throughout Africa via specialized facilities such as the SME Solutions Center (SSC), Private Enterprise Partnership for Africa (PEP
Africa) and African Management Service Company (AMSCO).

One Stop Shop
The SSC is a one-stop shop for small and medium scale enterprises (SMEs) in Kenya. SME sector growth is a key pillar of IFC's strategy in Kenya.
By leveraging both internal and partner resources, the SME Solutions Centers provide the following core package of products to small enterprisesThe SSC staff provide access to:

• Access to Finance - This is a critical issue for many growing small enterprises in Africa. Smaller businesses generally struggle to attract finances, whether in the form of debt or equity. Traditional long-term bank finance is generally inaccessible to small businesses because they lack the required collateral. Venture capital is not an option either as would be financiers cite the lack of opportunities to exit equity positions in small enterprises at rates of return justifying risk. To address these challenges, IFC has engaged Business Partners, a fund manager to set up the Business Partners International risk capital fund as the access to finance component of the SME Solutions Centers. Business Partners International (BPI) Kenya is a wholly owned subsidiary of Business Partners, a leading South African provider of risk capital to small and medium enterprises. So far, BPI has raised Ksh. 1 billion in Kenya. Sixty percent of the funds were raised from external local and international partners, including the European Investment Bank, Commonwealth Development Corporation, Norfund, Doen Foundation. A number of regional and local institutions have also invested as well, including the Assurance Reassurance Omnibranche in Madagascar, and Trans Century and the East African Development Bank in Kenya. Using the funds raised, support is extended to qualifying small enterprises in the form of equity, quasi equity, and debt financing. Repayment and exit (where equity is provided) is generally achieved from the cash flow of the investee companies.

• Business Information - The centers provide various information products and services on a commercial basis. These include access to reliable market information, broadband internet access, training facilities, database management, temporary office services, meeting rooms, and research facilities. The centers also operate fully-fledged incubation centers that enable small enterprises to pool and share resources under one roof.

• Capacity Building - Specific services provided under capacity building include assistance in setting up a new business, existing product enhancement, export development services, training, coaching and mentoring. Funds for capacity building are availed on a cost sharing basis through a part subsidy to participating firms. As part of the capacity building, the centers have successfully implemented and customized the SME toolkit for use in supporting the centers’ clients.

• Business Enabling Environment - By drawing from other IFC resources, such as the IFC PEP-Africa business enabling environment team, the centers are able to engage in policy advocacy on behalf of the SME sector.