LUXEMBOURG and SEATTLE (May 21, 2024) – In a significant step towards enhancing women’s economic power in Kenya, the Bill & Melinda Gates Foundation and the European Investment Bank (EIB) have announced a new partnership. This initiative aims to tackle key barriers to financial inclusion and promote gender equality through a €30 million microfinance programme.
The programme, supported by €15 million from EIB Global and additional financing from KCB Bank Kenya, is designed to primarily benefit women. It focuses on increasing access to finance for borrowers without collateral or credit history, implementing risk-adjusted pricing to address high interest rates, adapting digital services to meet the specific needs of female borrowers, and improving financial literacy.
KCB Bank Kenya will manage the programme under their Female-Led and Made Enterprises (FLME) and KCB Foundation 2jiajiri initiatives. The scheme aims to enhance access to microfinance across Kenya, leveraging insights to bolster future gender equality efforts across Africa.
“Across Africa, women need access to more and better credit to support their entrepreneurial activities,” said Greta Bull, Director of Women’s Economic Empowerment at the Bill & Melinda Gates Foundation. “Unequal access to credit remains a significant challenge, hindering economic activity and social progress for women in Kenya. This partnership aims to remove some of the barriers women face in accessing affordable financing, supporting them in starting businesses and contributing to wider economic growth. It’s a win-win.”
Thomas Östros, EIB Vice President, highlighted the importance of this initiative: “Women are the backbone of the African economy, with Africa home to the highest percentage of women entrepreneurs in the world. Yet, they face hurdles such as prohibitive interest rates and a lack of collateral. This partnership, combining the expertise and resources of the Gates Foundation and EIB, aims to overcome these challenges and enable women across Africa to harness new opportunities.”
KCB Bank Kenya Managing Director, Mrs. Annastacia Kimtai, emphasized the need for gender-focused financial products: “Women’s economic potential is dwarfed by challenges like a lack of appropriately designed financial products and institutional capacity. Addressing banking’s gender gap can significantly boost the financial industry’s bottom line by promoting female financial inclusion, digital banking, and access to credit.”
H.E. Henriette Geiger, European Union Ambassador to Kenya, expressed commitment to gender equality: “This cooperation between the Gates Foundation, EIB, and the European Union will enhance opportunities and improve the lives of thousands of women and their families in Kenya and across Africa.”
The initiative seeks to address technical and financial barriers to equal access to finance. A recent EIB survey revealed that while 65% of African banks have a gender strategy, lending to female borrowers remains limited. The new pilot programme aims to reduce the cost of loans for women through digital technology and risk-sharing, supported by technical assistance from KCB Bank Kenya.
Earlier this week, the Gates Foundation released a whitepaper on the challenges and opportunities for providing more and better capital to Africa’s women entrepreneurs. This cooperation represents a concrete step towards closing gender gaps and increasing financing for women. The programme benefits from a partial guarantee from the European Union under the European Fund for Sustainable Development Plus (EFSD+) and aligns with the Global Gateway strategy.