Skip to content

Swedfund restates dedication to an African microfinance expert by granting a successive loan.

Large-Scale Investment of $10 million Extended to Platcorp Holdings Limited, a Company Dedicated to Providing Loans for Small and Medium-Sized Enterprises (MSMEs) in Kenya, Uganda, Tanzania, and Zambia, Marking the Fourth Financial Aid They've Received So Far.

Swedish investment company Swedfund reinforces continued support for African microfinance...
Swedish investment company Swedfund reinforces continued support for African microfinance institution through consecutive loan provision.

Swedfund restates dedication to an African microfinance expert by granting a successive loan.

Platcorp Holdings Limited Bolsters Financial Inclusion and Local Economic Growth in East and Southern Africa

Platcorp Holdings Limited, a leading financial services company, is making strides in enhancing financial inclusion and promoting local economic growth across East and Southern Africa. The company, which focuses its microfinance services on lending to micro, small, and medium enterprises (MSMEs), is bridging the financing gap in these countries where small businesses often lack access to formal credit.

Based in Kenya, Platcorp extends its services to MSMEs across Kenya, Uganda, Tanzania, and Zambia. The company prioritises underserved and underbanked businesses and individuals who lack sufficient capital, collateral, or education to access traditional financial services. These include small roadside vendors, smallholder farmers, rural traders, and particularly women-owned enterprises.

The average loan size is about $320, reflecting a focus on the bottom of the economic pyramid and micro enterprises. This approach has led to a significant impact on local communities.

Employment Creation and Financial Inclusion

By providing affordable credit, Platcorp helps small businesses grow, creating decent jobs in local communities. The company's efforts also extend to closing the large financing gap in African SMEs, estimated at $330 billion, by extending formal credit access to MSMEs that are traditionally excluded from the formal banking sector.

Support for Women-Owned Enterprises and Climate-Resilient Agriculture

Women-led businesses form a significant part of Platcorp’s client base, promoting gender-inclusive economic growth. The company finances over 37,000 agricultural clients, mainly smallholder farmers or those in related value chains, supporting climate-smart farming practices. This focus on climate-resilient agriculture is crucial, as agricultural loans constitute about 10% of Platcorp’s portfolio due to risk and loan size considerations.

Local Economic Development

Loans facilitate restocking of small businesses, agricultural input sales in rural areas, and improvements in housing and education through affordable housing and school credit financing. This stimulates diverse sectors of local economies, contributing to sustainable and inclusive economic development.

A $10 Million Loan from Swedfund

To scale its impact, Platcorp recently received a $10 million loan from Swedfund, backed by the European Union. This loan is intended to increase lending capacity specifically to small businesses, women entrepreneurs, and climate-resilient agriculture projects. Swedfund's loan is supported up to 50% through an EU guarantee from the European Fund for Sustainable Development Plus (EFSD+) to accelerate financial inclusion.

Jakob Larsson, senior investment manager for Swedfund, stated that Platcorp's approach effectively identifies and supports small businesses. He expressed confidence that the loan will help businesses grow, create decent jobs, and have a particular focus on women-owned enterprises and climate-resilient agriculture.

Platcorp's philosophy is to only lend to people who will end up better-off after the loan. To achieve this, the company offers technical assistance, including agronomists for on-the-ground advice and training programs in financial literacy, sustainable agricultural practices, or silage management. This technical assistance is a key component of Platcorp's support for small businesses in East and Southern African countries.

In addition to agricultural loans, Platcorp also supports the trade and retail sectors, provides affordable housing development loans, and works to improve education, extending credit to both schools and individuals who want to attend school.

This is Swedfund's fourth investment in Platcorp, following earlier loans of $10m in 2018, $5m in 2020, and $15m in 2022. Platcorp takes precautions to avoid over-indebting borrowers and exposing them to high risks. The company's commitment to responsible lending practices, combined with its focus on underserved communities, makes it a valuable partner in promoting financial inclusion and local economic growth in East and Southern Africa.

  1. Platcorp Holdings Limited is bridging the financing gap for small businesses in East and Southern Africa by providing affordable credit, thereby helping these businesses grow and create decent jobs in local communities.
  2. By focusing on financing micro, small, and medium enterprises (MSMEs) and addressing the large financing gap in African SMEs, Platcorp Holdings Limited has extended formal credit access to many businesses traditionally excluded from the formal banking sector.
  3. The company's investment in women-led businesses, climate-resilient agriculture, and technical assistance for small businesses promotes gender-inclusive economic growth and sustainability in the region.
  4. To scale its impact and increase lending capacity, Platcorp Holdings Limited recently received a $10 million loan from Swedfund, which is supported by an EU guarantee and aims to support small businesses, women entrepreneurs, and climate-resilient agriculture projects in East and Southern Africa, furthering financial inclusion and local economic growth in the region.

Read also:

    Latest

    Construction technology company, Trunk Tools, secures $40M in Series B funding to deploy...

    Construction technology company, Trunk Tools, secures $40 million in Series B funding to introduce AI agents into the forefront of the construction industry.

    Construction technology firm Trunk Tools, revolutionizing data access and interpretation for professionals in the industry, secures $40 million in Series B funding. This round is headed by Insight Partners, with contribution from Redpoint Ventures, Innovation Endeavors, Stepstone, Liberty...