Sustainable Financing: Impacting You Where it Matters Most

Our Contribution to Sustainable Finance in Kenya, was recently recognised by Kenya Association of Manufacturers (KAM), during the Energy Management Awards. This recognition is a testament to our mission; ensuring social-economic impact through provision of financial solutions. To understand sustainable finance better, we need to break it down to five sections.

Economic. National Economic Survey report by the Central Bank of Kenya (CBK) in 2018 indicated that SMEs constitute 98 percent of all business in Kenya, create 30 percent of the jobs annually as well as contribute 3 percent of the GDP. In recognition of the significant role SMEs play, at Credit Bank, we have positioned to serve this segment with specifically designed products and services that meet the unique needs of our customers in various sectors including manufacturing, agriculture, services and trade. Further, due to the fact that many SMEs (e.g. 400,000 KNBS 2017) collapse within first three years of inception, we have partnered with various organizations that provide technical expertise to our SMEs to ensure financial instruments by the bank are provided in tandem with technical assistance thus increasing chances of success and contributing to their business longevity and sustainability.

In addition, part of our portfolio includes climate smart financial solutions tailored towards water harvesting, solar energy and biofuel technology. For example, are currently financing 11 projects valued at between $15-30 million in the renewable energy sector. To ensure value of the projects, we work with companies ensuring transfer of technical skills to locals.

Technology. This has aided us at Credit Bank to enhance our service delivery. Physical presence is no longer a necessity to ensure financial solutions are widespread. As a Bank, we continually invest in innovative technological solutions to enable distribution of our financial solutions efficiently. Up to 80% of our customers access our alternative digital channels for services. These channels include Mobile Banking Application, Internet Banking and Agency Banking. Further, as our customer, you can initiate a credit application online increasing convenience and eliminating extensive paper use. Our award-winning customer service is also a testament to the use of technology as customers challenges can be resolved simply via call, email or social platforms.

Partnerships. We strongly believe in working together and the right collaborative partnerships can yield great synergy. Partnerships further provide a greater resource base and provide avenues for our partners to distribute impactful financial solutions. We have, for example, engaged with Kenya Industrial and Research Institute (KIRDI) and Clean Cookstoves Association of Kenya (CCAK) to explore green energy solutions and financing to CCAK’s members.

Another partnership we have towards creating sustainable finance is with Camco Clean Energy supported by European Investment Bank to provide training on green energy finance and currently in discussion with Stawi Africa to partner in sustainable agriculture financing. African Guarantee Fund (AGF), another partner, provides capacity building of Credit Bank staff.

Risk Management. It is prudent as a Bank that risk management goes beyond traditional credit risk processes. Frameworks we use ensure risk is further assessed on environmental and social impact. The process begins identifying potential risks of the projects we finance followed by a thorough assessment of the identified risks. It is important for the customer to also showcase how they intend to mitigate the potential risks of the project. From the environmental aspect, we ensure projects we finance do not harm the environment. We further have mechanisms in place to monitor the risk profile both before and after approval of the financing.

Energy Resource Management. Part of sustainable finance includes efficient use of (energy) resources as an institution. Energy efficiency is a theme that must be carried by companies operating today. At Credit Bank, emphasis on this is no less than any other resource. It is our policy to our staff to switch off all lights and further idle power gadgets when they leave the office. Our branch locations ensure large windows fitting for natural light and ventilation. Through the board of directors, staff members are sensitized on energy management through enforcement of set policies, through advocacy and frequent trainings.

Governance. Effective leadership demands being led by example. Compliance starts from the top through implementing standards and procedures that can be grasped by everyone in the Bank. Further, we implement these policies in our financial solutions ensuring sustainability. A good example is our financing to construction activities. Before approval, we require an Environmental & Social Management Systems (ESMS) in place during and after construction. Our governance structure ensures further compliance to set laws and regulations on matters environment. The board of directors has in place an Environmental and Social Sustainability Policy that further complements the law.

Credit Bank is committed to Sustainable Finance as this gives us a long-term view of our financial activities. We are not just concerned about the bottom line but financing that impacts. Discover the friend you can bank on.

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