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Platinum and Premier Credit consider IFC loan of 4.6 billion shillings

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Platinum and Premier Credit consider IFC loan of 4.6 billion shillings


IFC Regional Director for East Africa Jumoke Jagun-Dokunmu. FILE PHOTO | NMG

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Summary

  • The loan is part of a total financing of $45 million (5.2 billion shillings) which includes their subsidiaries Platinum Credit Uganda and Premier Credit Uganda.
  • The microfinance companies are owned by the Mauritian company Platcorp Holdings, which will guarantee the loans.
  • Platinum Credit Kenya offers multiple services including loans to government officials, vehicle owners, SMEs and import finance.

Microfinance companies Platinum Credit Kenya and Premier Credit Kenya are expected to secure a loan of $40 million (4.6 billion shillings) from the International Finance Corporation and its partners to finance their lending activities.

The loan is part of a total financing of $45 million (5.2 billion shillings) which includes their subsidiaries Platinum Credit Uganda and Premier Credit Uganda.

The microfinance companies are owned by the Mauritian company Platcorp Holdings, which will guarantee the loans.

“The proposed project consists of a senior loan of up to $45 million to subsidiaries of Platcorp Holdings Limited, namely Platinum Credit Kenya, Premier Credit Kenya, Platinum Credit Uganda and Premier Credit Uganda,” IFC said in its investment statements. .

“IFC’s own account will be $20 million in Kenya and $5 million in Uganda, with the remaining $20 million being mobilized for Kenyan entities through B1/parallel loans as appropriate. possible. »

The global financier added that the transactions aim to provide liquidity to microfinance companies to support the growth of their loans to micro, small and medium enterprises (SMEs).

Platinum Credit Kenya offers multiple services including loans to government officials, vehicle owners, SMEs and import finance. Premier Credit Kenya offers general business and consumer loans.

Microfinance companies mainly offer short-term loans, but also provide medium-term credit facilities. The interest rate on loans – on an annualized basis – is significantly higher than the current average of 12.1% for banks.

Small lenders are popular with individuals and SMEs because of their more personalized service and ease of access to credit, especially for those who have developed long-standing relationships with institutions.

IFC said the loans it mobilizes will help institutions extend their current average borrowing term of less than two years to meet their long-term financing needs.

“The proposed loan of up to $45 million is a 3-year senior loan, with a one-year grace period,” IFC said.

Platcorp Holdings has nine microfinance companies operating in Kenya, Uganda, Tanzania, Lesotho, Zambia and South Africa. It manages over $224 million (26 billion shillings) in assets, has 574 branches and approximately 10,000 employees serving more than 700,000 active customers.

“The model is based on a brick-and-mortar approach, operating best through small branches, enabling a high touch relationship with their clients,” IFC said.

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