Banks continue to boost financial inclusion in Kenya by providing retail finance to the MSME segment. The banks’ total SME lending portfolio in December 2013 was estimated to be 23.4% of their total lending portfolio but considering that the largest percentage of businesses in Kenya are in the MSME sector, financing to MSMEs should continue to grow. In this briefing note, we explore strategies to be employed by banks in Kenya to increase financing to the MSME segment in the face of competition from formal and informal financial services providers.

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