As part of the UN-led DigiKen Programme, the new financing solutions will expand access to finance for digital enterprises, supporting entrepreneurship, innovation, and job creation across Kenya.

The Co-operative Bank of Kenya, in partnership with the United Nations Capital Development Fund (UNCDF), has introduced a suite of financing solutions designed to expand access to capital for technology-driven enterprises in Kenya. The financing solutions have been developed under the USD 900,000 Loan Portfolio Guarantee Facility signed between UNCDF and Co-operative Bank of Kenya and announced earlier this year and forms part of the broader Digital Platforms Kenya (DigiKen) Programme, a United Nations initiative funded by the European Union through the Joint SDG Fund that supports Kenya’s digital transformation agenda.

Under this arrangement, UNCDF shares a portion of the lending risk with the Bank, enabling it to extend financing to digital and digitally enabled businesses that may not otherwise meet conventional lending requirements. Through these financing solutions, Co-operative Bank of Kenya is translating UNCDF’s guarantee support into practical financing opportunities for digital enterprises seeking capital to grow, innovate and create jobs.

The financing solutions, managed by Co-operative Bank of Kenya, are designed to address a critical financing gap for many digital and digitally-enabled businesses that struggle to secure commercial loans due to limited collateral, evolving business models, and short operating histories. By reducing risk for Co-operative Bank, the partnership aims to unlock new investment, serving as a primary vehicle for achieving DigiKen’s target of enabling 150 Kenyan Micro, Small, and Medium-sized Enterprises (MSMEs) to secure funding. Ultimately, this mobilized capital is projected to generate 4,500 direct jobs and 20,000 indirect jobs in Kenya’s digital economy, directly advancing the Government of Kenya’s Digital Superhighway Agenda.

Representatives of government, UN and private sector partners during a DigiKen Programme Steering Committee meeting in Nairobi. Participants included Eng. John Tanui, Principal Secretary, State Department for ICT and the Digital Economy; Dr. Garry Conille, United Nations Resident Coordinator in Kenya; Louise Haxthausen, UNESCO Regional Director and Representative for Eastern Africa; Omon Ukpoma Olaiya, UNCDF Regional Investment Team Lead; John Okande, UNESCO Programme Coordinator; Millicent Okello, UN Women Women's Economic Empowerment Unit Team Lead; and Co-operative Bank of Kenya representatives Zakayo Maina, Head of Digital Partnerships, and Alex Kinyua, Relationship Manager, SME and other stakeholders. Photo: MoICDE.

Eng. John Tanui, Principal Secretary, State Department for Information, Communication, Technology and Digital Economy, welcomed the initiative as an important contribution to Kenya's digital transformation agenda. “A thriving digital economy depends not only on innovation, but also on access to capital. By de-risking lending and improving access to finance for homegrown digital platforms especially those led by women and youth, we are helping entrepreneurs and MSMEs turn ideas into businesses, strengthen local innovation and accelerate growth of Kenya’s Tech Sector and the Digital Superhighway Agenda.”

Supported by UNCDF’s guarantee facility, these financing solutions are designed to catalyse additional lending for qualifying businesses through Co-operative Bank of Kenya. The facility provides guarantee coverage of between 50 and 70 percent of loans extended through the financing solutions, with enhanced coverage of up to 70 percent available for enterprises operating in Kenya's Arid and Semi-Arid Lands (ASALs). This enables the Bank to extend financing to businesses that may otherwise struggle to meet conventional lending requirements, while supporting greater access to finance in underserved regions.

Omon Ukpoma-Olaiya, Regional Investment Team Lead for East and Southern Africa and the Arab States Region, UNCDF, shared “Many promising businesses struggle to access financing, not because they lack potential, but because they do not fit traditional lending models. Through this partnership, we are derisking Co-operative Bank of Kenya so it has the confidence to back entrepreneurs who can drive innovation, growth and job creation and access the capital they need to thrive.”

The financing solutions are designed to support working capital, business expansion, and technology investments across key segments of Kenya's digital economy, including fintech companies, digital credit providers, e-commerce and digitally enabled MSMEs, and digital innovation hubs and ecosystem enablers.

For Dr. Gideon Muriuki, Group Managing Director and Chief Executive Officer of Co-operative Bank of Kenya, the partnership highlights the Bank's commitment to supporting enterprise growth.

“Kenya's digital economy is creating exciting opportunities for businesses of all sizes, yet many entrepreneurs still struggle to access the financing needed to turn ambition into growth. Through this partnership, we are providing practical financing solutions that will help innovative businesses invest, expand and create jobs while strengthening Kenya's competitiveness in the digital age", said Dr. Gideon Muriuki.

The financing solutions are an example of how the DigiKen programme, implemented by UNESCO (Lead Agency), UNCDF, UN Women, and UNEP, in close coordination with the UN Resident Coordinator’s Office and in partnership with the Ministry of Information, Communications and the Digital Economy (MoICDE), is bringing together government, development partners and the private sector to address barriers to digital transformation and economic opportunity in Kenya.

Dr. Garry Conille, United Nations Resident Coordinator in Kenya, emphasized the importance of improving access to finance for entrepreneurs, highlighting the collective vision behind the milestone.

“For the United Nations, the value of this partnership is about widening who can participate in Kenya’s digital economy. We need to find practical ways to bring opportunity closer to young people, women and entrepreneurs in underserved communities who too often remain outside traditional pathways to finance. DigiKen shows the value the UN can bring by connecting Government, finance and development partners around solutions that turn talent and ideas into viable businesses, jobs and livelihoods", said Dr. Garry Conille.

Over the coming months, Co-operative Bank, UNCDF, and their DigiKen partners will launch targeted outreach and capacity-building campaigns across Kenya's regional digital innovation hubs. By working closely with local entrepreneurs, tech hubs, and industry stakeholders to drive awareness and rapid uptake of the financing solutions, the partnership aims to translate this increased access to finance into immediate, real-world digital growth and economic opportunity.