Private equity firm seeks KSh100bn assist SME growth.

Fusion capital to assist SMEs in East Africa.

Fusion Capital a local private equity firm, is seeking KSh100 billion in the next five years to increase its funding for Small and Medium Enterprises in Kenya and across the East African region.

The private equity fund that finances Small and Medium Enterprises as well as start-ups will be looking to raise this money from private investors in Europe. Development Finance Institutions (DFIs), high network individuals and companies in Kenya to grow its financing for the fast growing SME sector in Kenya.

Luke Kinoti, the Fusion Capital chief executive officer confirmed that this will boost the firm’s funding activities as it targets more upcoming firms in the East African region. The firm already has four branches in Kenya, Tanzania, Uganda and Rwanda.

This would help the firm in extending its funding to less than 10 per cent interest in the different sectors of the economy. At the moment, the firm has 425 SMEs being financed to a tune of KSh15 billion.

During the Fusion Business Club launch, Mr. Kinoti confirmed that the firm is not only able to provide funding to any SME or start-up that is able to borrow from Sh1 million to Sh300 million but also help in strengthening their management or governance structures.

He further said that the firm is seeking to raise Sh680 million between now and March next year to continue supporting SME operations.

There are about 50,800 small and medium enterprises that each employ between five and 49 workers.

Mr. Kinoti further said that the firm has submitted a proposal to the Capital Markets Authority (CMA) to allow it to be listed on the Nairobi Securities Exchange (NSE) in future.

Speaking at the same function, assistant minister in the Ministry of Industrialization said that the government has put in place incentives like investment certificates that would allow them to recover their investments before they are subjected to tax.

This is the right move at the moment where firms are seeking for funds to aid their growth and expansion. In addition, the Small Enterprises are being recognized as a potential segment for economic development.