Kenya’s banking sector disbursed Ksh 81.4 billion in loans to micro, small, and medium-sized enterprises (MSMEs) between January and May 2025, according to new data released by the Kenya Bankers Association (KBA). The industry milestone reaffirms the financial sector’s continued commitment to supporting entrepreneurship, job creation, and economic growth in the country.
Small and Medium Enterprises (SMEs) form the backbone of Kenya’s economy, representing a substantial share of the country’s business landscape and employment. They play a critical role in driving job creation, fostering innovation, and contributing to sustained economic growth.
These enterprises span a broad spectrum from micro-businesses with only a handful of employees to medium-sized firms employing up to 99 people. It is estimated that the sector employs over 15 million people and contributes about 30% to the national value-added.
Leading the charge is Equity Bank, which disbursed a remarkable Ksh 24.9 billion in SME loans in Kenya over the five-month period. The institution’s dominance in the SME lending space reflects its longstanding strategy to empower small businesses as a cornerstone of inclusive economic development.
The KBA ranking showcases the top 10 banks by total MSME disbursements from January to May 2025:
Bank Loan Disbursement (Ksh)
| Equity Bank | 24.9 billion |
| Co-operative Bank | 12.6 billion |
| I&M Bank | 11.3 billion |
| KCB Bank | 11.1 billion |
| Stanbic Bank | 5.2 billion |
| National Bank | 2.7 billion |
| Commercial Intl. Bank | 2.4 billion |
| Absa Bank | 2.4 billion |
| Sidian Bank | 1.8 billion |
| Gulf African Bank | 1.2 billion |
The surge in MSME lending aligns with national economic objectives, including Kenya’s Bottom-Up Economic Transformation Agenda (BETA), which seeks to elevate grassroots enterprises into mainstream economic players.
Micro, small, and medium enterprises account for over 90% of businesses in Kenya and contribute nearly 40% of the country’s GDP, according to the Kenya National Bureau of Statistics. Increased access to affordable financing is considered one of the most significant enablers of growth and formalisation in the MSME sector.
The collective disbursement of Ksh 81.4 billion during the first five months of 2025 marks a robust recovery trajectory following macroeconomic challenges faced in previous years, including inflationary pressures, currency depreciation, and tight credit markets.
The impressive lending figures are also a testament to sector-wide efforts to promote financial inclusion. Banks have been collaborating with government agencies, development finance institutions, and fintech innovators to unlock capital for Kenya’s over 7.4 million MSMEs.
KCB Bank and Co-operative Bank, ranking fourth and second respectively, have both expanded their SME-specific products and launched credit guarantee schemes in partnership with the government and donor agencies.
Stanbic Bank, which disbursed Ksh 5.2 billion, has also been active in supporting women-led MSMEs through targeted initiatives under its “DADA” (Dare to Aspire, Dare to Achieve) programme.
In addition to offering financial services such as loans and savings, the programme is dedicated to fostering a community of women through networking, capacity-building, and mentorship empowering them to grow personally, expand their businesses, and uplift their communities.
Industry analysts believe SME loans in Kenya will surpass Ksh 200 billion by the end of 2025 if current trends hold. With increasing adoption of credit scoring technologies and alternative data sources, more small businesses are expected to qualify for loans, fuelling further economic momentum.
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