Are you starting a business or looking to expand? Getting an SME Loan in Kenya can be a tasky affair if you are not well prepared. We have gathered a few tips that can help you get your SME Loans in Kenya approved by any lender. You can improve your chances of getting finances from lenders in these 5 simple tips. This information was compiled from http://milhanaccesscapital.com

1. Compiled from: https://milhanaccesscapital.com
Tips to Get your Loans Approved
SME LOANS IN KENYA

2. Want your SME Loan to be approved?
How to Get SME Loans in Kenya
This information was compiled from: https://milhanaccesscapital.com
When starting a business in Kenya, without a doubt money is the most limiting factor. Obtaining fin
ance is important for starting or growing your business’s major day to day expenses like Inventory a
nd payroll. Getting capital or finance is one of the biggest hurdles facing Small Business Enterprises
mostly due to banks’ lending structures and standards.
Whilst it is difficult, it is not impossible with the right preparation. Here is how to get a SME Loan an
d what you can do to increase your chances of approval.

3. #1 Indicate why you need the Loan
The first question to get from lenders is why you need the money. Asking yours
elf how this loan will support your business and having ready detailed answer is
one easy of way of getting your SME Loan approved.
Depending on your needs, your answer is likely to fall under the starting your b
usiness, managing everyday expenses or growing your business. Pinpoint in whi
ch ways the loan will help meet your business’s needs.
This information was compiled from: https://milhanaccesscapital.com
Tip #1

4. #2 Decide on the type of business loan you nee
d
Doing research will help you find out which is the best type of loan for you. This
is majorly determined by your reasons for requesting an SME Loan. For startups
, it is almost impossible to get a loan in your company’s first year of operation fr
om banks since they require proof of how the business will support the repayme
nt of the SME Loan.
While banks may immediately disqualify you from financing, with the rise of mo
bile lending apps in Kenya, getting a loan is not as difficult as it was before. Ther
e are websites like Go Fund me Kenya that support crowd funding (the digital v
ersion of Harambee), you can also get a Logbook Loan from lending companies
, or get financing from Non-profit Lenders.
However, companies with more than one year of revenue have more financing a
vailable to them.
This information was compiled from: https://milhanaccesscapital.com
Tip #2

5. #3 Find the best type of SME lender for you
Comparing the different lenders and their loan terms and conditions will help o
n choosing where and who to borrow from. While the increasing number of len
ders means more opportunities for SME to get financing in Kenya, it also means
more places to choose from. Before setting on a lender, it is important to first co
mpare their terms.
You should approach SME Financing in Kenya more like car shopping. Calculate
the estimated payments to determine which business loan will work for you. On
ce you choose on the best lender for you, compare the total borrowing cost an
d pick the one with the lowest Annual Percentage Rate (APR).
To be able to repay your loan comfortable each month, your total income shoul
d be at least 1.25 times your total expenses. There are loan calculators like Aren
This information was compiled from: https://milhanaccesscapital.com
Tip #3

6. #4 Find out whether you meet the SME Loan
qualifications
Before sending in your application, it is crucial to check if you have what is requi
red for the type of loan you have decided on and the lender. This is where your
credit score and annual revenue plays an important role. Your credit rating will d
etermine which loan you will qualify for.
You can check your CRB Listing at https://www.metropol.co.ke/
Lenders look at three things, How long have your business been in operation, H
ow much money do you make and will you be able to make the payments. To q
ualify for most SME Loans from banks, you must have been in business for a mi
nimum of two years while with online small business loans it is at least one year i
n operation.
This information was compiled from: https://milhanaccesscapital.com
Tip #4

7. #5 Gather your required documents and Apply
After comparing your available options and weighing in on each’s benefits and limit
ations depending on your financial needs, it is now time to gather your documents t
hat lenders will ask for ahead of time. You can apply for multiple SME Loans from diff
erent lenders to increase your chances of getting funding.
The basic requirements for SME Loans in Kenya include but are not limited to;
 Business and personal tax returns
 Business and personal bank statements
 Business financial statements
 Business legal documents (e.g., articles of incorporation, commercial lease, franc
hise agreement)Top of Form
 Bottom of Form
It necessary to look at your company’s financials especially the cash flow to determin
e how much you will be able to afford in terms of loan repayments every month.
This information was compiled from: https://milhanaccesscapital.com
Tip #5

8. Tips for getting your SME Loan approved
This information was compiled from: https://milhanaccesscapital.com
Use banks only when you are able to provide collateral, you have good credit and you don’t
need cash urgently.
Use Microfinance and Saccos when you cannot get a traditional loan from a bank for differe
nt reasons or your business is still too small. However their interest rates are a bit her than b
anks.
Use online lenders when you lack collateral, you lack time in business and you need funding
quickly. While online lenders compete with banks in terms of interest rates, the approval rate
s higher and faster unlike banks.

9. This Information was Compiled from:
https://milhanaccesscapital.com