Diamond Trust Bank (DTB) expects lending to individuals and small businesses in Kenya to grow as the country’s economy steadies after a challenging 2024.
DTB Kenya CEO Murali Natarajan expressed optimism about Kenya’s economic prospects, citing improved macroeconomic conditions.
“When I look at the resilience of the economy and the track record of having dealt with so many challenges, that gives me immense confidence,” Mr Natarajan said during the DTB Economic and Sustainability Forum in Nairobi.
He added that small businesses and individual borrowers would feel the impact first.
“The MSME segment, which is partly informal and partly formal, offers a big opportunity. With our team’s effort, the board’s guidance, and the Group CEO’s support, we are confident we can double our balance sheet in three to four years by focusing on sectors like agriculture, retail, and MSMEs,” he said.
Mr Natarajan noted that achieving this growth would involve expanding digital services, forging new partnerships, and increasing DTB’s branch network to serve more customers.
He praised the government and the Central Bank of Kenya for stabilising the economy through measures such as lowering interest rates, benefiting from good rains, and falling fuel prices.
“I congratulate the Government and the Central Bank of Kenya for steering the ship through difficult times last year. Interest rates are coming down, and remittances from Kenyans abroad continue to flow,” he said.
DTB projects Kenya’s economy will grow by 5% this year, though challenges remain.
On his part, Dr Chris Kiptoo, Principal Secretary at the National Treasury, echoed similar sentiments, saying the worst was over for Kenya’s economy.
“When I started, it was very hard, and I had many sleepless nights. Now the worst is over, and the future is brighter. We have a resilient, diversified economy, and that’s how we come out of shocks,” said Dr Kiptoo.
He said the upcoming budget would focus on agriculture, tea exports, edible oil, cotton, leather, dairy, natural resources, building materials, and the blue economy.
To enhance private-sector lending, Dr Kiptoo revealed that the Credit Guarantee Scheme would soon be transferred to a government-owned company to sustain its operations.
The scheme currently ensures the government covers part of loans in case of defaults.
Additionally, Dr Kiptoo said the government had approved KSh236 billion out of more than KSh600 billion in pending bills inherited by the Kenya Kwanza administration, with most payments set to benefit small businesses and road contractors.
He assured that Kenya would remain under the International Monetary Fund (IMF) programme to ensure continued economic stability.
“The implementation of the Single Treasury Account, e-procurement policy, zero-based budgeting, and public-private partnerships will be prioritised to increase development spending,” he concluded.
