6th-Dec-2025 • Isaac Kennedy • Investment and Funding
For Small and Medium Enterprises (SMEs) in Kenya, securing the right investment or funding can be a game-changer. However, navigating through the myriad of options may seem daunting. This article provides an overview of key investment and funding sources that SMEs should consider to fuel their growth.
Traditional bank loans remain a popular choice for many businesses. Kenya's top banks offer various loan products tailored to SMEs, such as overdraft facilities and business loans. For instance, KCB Group offers the M-Pawa Loan for digital businesses, while Equity Bank provides various affordable loan options.
Venture capital (VC) firms invest in promising SMEs with high growth potential, often providing not only funding but also valuable expertise and networks. Some notable Kenyan VC firms include Savannah Fund and 88mph. For example, Savannah Fund invested in Sendy, a digital logistics platform that has seen significant growth since.
The government of Kenya offers grants to support SMEs in various sectors. The Youth Enterprise Development Fund (YEDF), for instance, provides interest-free loans and grants to youth-led businesses. The Africa Enterprise Challenge Fund also offers funding for projects that promote economic development and job creation.
Crowdfunding platforms allow individuals and other investors to support projects they find interesting, often in exchange for rewards or equity. Kenya's iHub offers a crowdfunding platform called LipaLater, where SMEs can raise funds from the public.
Peer-to-peer (P2P) lending platforms connect borrowers with investors looking to earn higher returns. Some P2P platforms in Kenya include M-Shwari and Branch. These platforms can provide quick access to funding for SMEs, especially those with limited credit history.
Business management platforms like Lipabiz Technologies Ltd offer integrated solutions that can help SMEs streamline operations and improve efficiency, making them more attractive to investors. By demonstrating strong business performance through data-driven insights, SMEs can improve their chances of securing funding.