Financing small business means economic growth – everywhere!
Why supporting small business in accessing finance is crucial
Small and medium-sized enterprises (SMEs) are the foundation of Africa's economy, playing a vital role in driving employment, innovation, and GDP growth across the continent.
At UBA, we understand that empowering SMEs not only stimulates economic development but also strengthens local industries and promotes financial inclusion.
In Kenya, SMEs are the driving force behind the economy, contributing over 40% to the nation’s GDP and employing more than 80% of the workforce. However, this sector faces significant challenges, with an estimated KES 1.3 trillion ($1 trillion) financing gap hindering their growth.
Access to finance, trade facilitation, and market expansion remain major obstacles for these businesses. Supporting SMEs is crucial to overcoming these barriers and unlocking their full potential.
SMEs face significant challenges in accessing finance, primarily due to limited collateral, which makes traditional loans difficult to obtain. Additionally, the absence of a solid credit history and formal documentation further complicates banks’ ability to assess the creditworthiness of these businesses.
Finally, low financial literacy, particularly in debt management, contributes to limited bankability.
At UBA, we view SMEs as a key driver of economic growth and have developed innovative risk assessment models alongside capacity-building initiatives to counter these challenges.
Our solutions are designed to reduce risks and offer sustainable financial support tailored to the unique needs of small businesses.
We support SMEs by offering a range of tailored financial solutions, trade finance, cross-border payment systems, and strategic partnerships that help them scale their operations both locally and internationally. Our support package includes both financial and non-financial services, including working capital loans, trade finance, invoice discounting, and overdraft facilities, which provide businesses with the liquidity they need to grow.
We also offer cross-border payment solutions that simplify international transactions and advisory services to assist SMEs in navigating the complexities of trade. Through our UBA Connect and AfriCash platforms, we enable SMEs to make and receive payments across borders efficiently, reducing transaction costs and fostering regional trade integration.
In partnership with the Africa Guarantee Fund, we help de-risk SME lending, making it easier for businesses, particularly women-led enterprises, to access financing with reduced collateral requirements. We’ve also teamed up with Real Sources Ltd under the TradeConnect Initiative to open new growth opportunities for Kenyan exporters and manufacturers, providing working capital, trade advisory, and access to regional markets under the African Continental Free Trade Area (AfCFTA).
We have observed that by unlocking capital access, we are enabling entrepreneurs to scale their operations and create jobs in underserved communities. Growth is most notable in sectors such as agri-business, retail, trade, and transport.
We have also seen the rise of informal SME clusters and business communities especially within our customer networks, where entrepreneurs collaborate, share opportunities, and support one another through mentorship. These networks are helping businesses build resilience and navigate complex market challenges together.
Today, four in 10 SMEs supported by UBA are women-led. While this marks progress, the data reveals that many women entrepreneurs still face barriers in fully leveraging financial tools and networks. Our ongoing SME forums and women-focused initiatives aim to bridge this gap through capacity-building, peer learning, and targeted lending programs.
One of the key objectives of the AfCFTA is to enhance access to finance and markets for SMEs, fostering their growth and contributing to Africa’s socioeconomic development.
UBA has entered a three-year partnership with the AfCFTA Secretariat, committing to provide $285 million in financing for eligible SMEs across Africa, including Kenya. This collaboration promotes small businesses in four key sectors: agro-processing, automotive, pharmaceuticals, and transport & logistics—which are often heavily reliant on imports. The partnership offers technical and financial solutions that encourage intra-African and domestic alternatives in these sectors.
Through this agreement, UBA supports intra-African trade by providing seamless financial solutions that facilitate cross-border transactions, trade finance, and investment flows. With our strong pan-African presence in 20 countries and financial hubs in the United States, United Kingdom, United Arab Emirates, and France, UBA is strategically positioned to connect African businesses to new markets, further driving regional economic integration and growth.
To ensure SMEs thrive, it is essential for banks to adopt creative financing models and ecosystem-based solutions that go beyond traditional lending approaches.
UBA is dedicated to expanding its offerings to small businesses by introducing innovative digital financing solutions, trade facilitation programmes, and strategic partnerships. We are focusing on fintech collaborations to enhance access to credit, particularly for women-led enterprises, and developing sustainability-driven financing models to support green business initiatives.
To ensure SMEs thrive, it is essential for banks to adopt creative financing models and ecosystem-based solutions that go beyond traditional lending approaches.
UBA is dedicated to expanding its offerings to small businesses by introducing innovative digital financing solutions, trade facilitation programmes, and strategic partnerships. We are focusing on fintech collaborations to enhance access to credit, particularly for women-led enterprises, and developing sustainability-driven financing models to support green business initiatives.
