Sidian Bank, Medical Credit Fund Launch Ksh 2 Billion Pacesetting Lending Deal For Private Healthcare Sector

26 July 2016

Nairobi, July 26, 2016 – Sidian Bank and Medical Credit Fund have announced a Ksh. 2 billion partnership that will benefit private healthcare service providers in Kenya.

 

 

Sidian Bank and MCF 

  • Sidian Bank commits to lend up to Ksh. 2 Billion.
  • Piloted in 2010, the partnership has attracted the attention of more than 400 medical service providers in Kenya, and issued more than Ksh. 700 million in loans.
  • When up scaled, the partnership should benefit the more than 2,500 medical service providers in Kenya

The agreement will see 2,500 private medical services providers; health facilities, health training institutes and suppliers to the health sector in Kenya, receive loans of between Ksh. 100,000 - 250 million towards the purchase or maintenance of medical equipment, expansion of facilities, as well as receiving technical know-how from Medical Credit Fund (MCF).

Considering that the current number of health care providers benefitting from this scheme serve an average of 3 million patients each year. The deal is set to significantly boost the private healthcare sector.

The partnership that began on a pilot basis in 2010 has already attracted the attention of up to 400 medical service providers, and disbursed loan amounts of over Ksh. 700million.

Speaking during the launch ceremony in Nairobi, Sidian Bank's Chief Executive Officer, Mr. Titus Karanja, noted that " Today, many small and medium-sized private healthcare enterprises struggle to access working capital, infrastructure finance, purchase modern equipment or even pay for basic repairs. At Sidian Bank, we understand the challenges entrepreneurs face and through this partnership, we are living out our brand promise of enabling entrepreneurs create wealth through provision of transformational financial solutions."

He further added that "More than 35 percent of the healthcare in Kenya delivered by the private sector, therefore investing in this sector has an enormous impact and addressing the financial needs of private healthcare entrepreneurs will lead to the overall improvement of Kenya's healthcare services."

Through this partnership with Medical Credit Fund, Sidian Bank becomes one of the first financial institutions to venture into financing the private healthcare sector on a large scale.

MCF was set up as the first and only dedicated program, providing loans to private healthcare providers in partnership with local banks and combining it with technical assistance to the providers.

Through such partnerships, banks have a low-risk entry while helping healthcare providers to meet conventional bank requirements, as the loans offered are combined with technical assistance through a business and quality improvement program using the internationally recognized quality SafeCare standards.

So far, MCF has facilitated business and quality training for over 1,200 clinics and has disbursed approximately 850 loans totaling over USD 15 million, with a stable 97% repayment performance throughout the African countries it operates in.

Mr. Bart Schaap, Finance Director Medical Credit Fund said that "Sidian Bank is the best performing partner to date and well aligned for the future. In the past five years we have helped many healthcare providers to build a financial track record and become bankable, grow their business acumen and improve the quality of their healthcare services. We have shown that investing in health is a solid investment and look forward to intensifying our efforts."

Sidian Bank, formerly known as K-rep Bank, was founded in 1984 with the aim of providing grants and technical assistance to NGOs for on-lending to micro-enterprises. In 1999 the microfinance institution became a fully-fledged bank offering an array of services to the Micro, SME and Corporate sector.

The bank's new vision is to be recognized as the preferred partner in realizing entrepreneurial potential. Sidian Bank offers a variety of financing solutions which are specifically geared towards the improvement of quality provision in the medical sector. Currently the loan sizes range from Ksh100, 000 to Ksh 250 million for the target Health SMEs, accompanied by technical assistance.

In the coming years, Sidian Bank aims to increase the number of loans to the health sector at large through development of more financing products as part of its ongoing efforts to focus on its core activities to improve the bank's efficiency and viability, and thus adding more value to its customers.

 

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