Small-scale traders in Kisumu can now access cheap loans following the creation of a fund from which they can borrow.
Kisumu County Governor, Peter Nyong’o, recently assented to the Bill – Kisumu County Enterprise Bill – which has given legal backing to the formation of the kitty.
The fund is expected to grant unsecured loans to small-scale traders – majority of whom are youth and women- who have hitherto been locked out of mainstream financing by major banks due to tough collateral demands.
The loans will be repaid with an annual interest rate of eight per cent.
Most of the micro-businesses have remained crippled because they cannot raise the collateral demanded by the banks.
The new fund is based on a similar idea as the one mooted by the Lake Region Economic Bloc (LREB) while planning to form a regional development bank.
The kitty will get money from the annual allocations from the county budget, as well as a levy that will be created to fund it.
A committee will be formed to vet the businesses that will qualify for the loans.
The Bill is one of three others the county chief has lately assented to. Others are the Village Councils Bill and the Road Maintenance Bill.
Professor Nyong’o also expressed hopes that the fund will spur job creation in the lakeside city and county at large.