SME finance
Business Loans in Kenya
A business loan should be repaid from real cash flow, not only optimism. Before borrowing for stock, equipment, inputs, transport, or expansion, estimate how the money will generate income and when that income will arrive.
Common business financing options
| Option | Use case | Risk to check |
|---|---|---|
| Working capital loan | Stock, rent, supplier payments, short cash gaps. | Repayment before stock turns into cash. |
| Asset finance | Motorbike, vehicle, machinery, salon equipment. | Repossession risk and maintenance costs. |
| Agriculture credit | Seeds, fertilizer, feeds, irrigation, livestock. | Weather, market prices, disease, delayed harvest. |
| Invoice or LPO finance | Fulfilling orders before customer payment. | Delayed payment from buyer or rejected delivery. |
Cash-flow test
List expected weekly or monthly sales, cost of goods, rent, wages, transport, family withdrawals, and existing debts. If the loan repayment removes the cash needed to restock or operate, the loan may weaken the business instead of growing it.
Records that improve credibility
Clean M-Pesa till records, bank statements, sales books, supplier receipts, tax records, licenses, and inventory records can help a lender understand the business. Good records also help you know whether borrowing is necessary.