There is no escaping the facts that small and medium businesses are the backbone of the Kenyan economy.
Like any other entrepreneurs across the globe, Kenyan entrepreneurs often find themselves facing stubborn financial straits. When this happens, their businesses implode. Cash constraints bite hard, culminating in staff layoffs. In extreme cases, businesses close shop.
Unlike their counterparts in the developed world who can easily access affordable credit, local entrepreneurs have few options.
The statistics are scary. Data from the Kenya National Bureau of Statistics shows that 52% of all loan applications made by SMEs were rejected by banks and other financial institutions.
To change this narrative, a non bank and non deposit taking financial institution is introducing an innovative way of financing SMEs. StartUp Magazine got in touch with Job Muriuki, the CEO of Momentum Credit Limited to discover how the firm gives SMEs a financial lifeline. We also went ahead and run snippets of their happy customers and how they have benefitted financially for the creditor.
According to Muriuki, opportunity cost is the greatest cost in both business and in life. And what would you do when you have all the resources you require to do something? Simply amazing!
“As Momentum Credit we look to eliminate that greatest cost in business through innovative financial models. We have a group of products that are optimised in helping a business access working capital.”
True to their words, Momentum Credit has supported Skeme Advertising Group with working capital which has greatly boosted their operations. Brian Noah, the MD of Skeme Advertising Group says that they needed someone who can give them the quickest turn around period. “We had little option but to head to Momemtum Credit.”
“Since then anytime we needed a financial help they have always been at hand to offer us one. That has in turn enabled us to execute our projects to our level best,” says the business man.
Our flagship product is called invoice factoring, Muriuki goes on. “Basically it is a form of financing where a business sells invoices to a third party at discounted prices. So if you have unpaid invoices and need a cash injection please come and visit us.”
Kenneth Kiprono, a businessman in the logistics space could also not hide his joy when asked about Momentum Credit’s financial impact on his business.
“I always need money all the time to get the job done. But there has always been a cash flow problems,” he says.
“There is this moment I wanted to contract more vehicles for my work and I was cash strapped then Momentum Credit came calling. I made inquiries and found out that the requirements were reasonable for a small business like mine. It took me less than 24 hours from the time of application to actually getting the money, says Kiprono.
He was also wowed by their customer support team. “There is a time I knew I would delay repaying the loan and all I needed to do was to call them. They understood my dilemma and renegotiated a better repayment terms. I later cleared the loan comfortably. I believe I will go along way with Momentum Credit’s financial support.”
Muriuki says there are other financial products they offer like logbook loans. These are quick cash instruments that can help one access funding within 24 hours.
“Above all, we exist to provide alternative credit to SMEs and expand their possibilities.”
Muriuki concludes that their vision is to transforms structured non-bank financing across Africa.