East African banks turn to SME lending, but credit gap remains

East African lenders may have made strides this year in securing multimillion-dollar agreements for lending to micro, small, and medium-sized enterprises (MSMEs). But there is still a huge financing gap, with many smallholder firms struggling to access affordable credit.

Nearly all leading banks in the region have this year landed at least one major deal with international financial institutions, to provide subsidised loans to MSMEs, increasing the available pool of financing to the sector that provides over half of jobs globally.