Stanbic Bank has indicated that they plans to raise KES12.9 billion in a bid to finance startups across East Africa. Through its Catalytic Fund, the bank plans to back startups and small and medium enterprises (SMEs) that typically struggle to raise capital.
This move signals a shift in Kenya’s banking sector, which has kept its distance from founders struggling to raise funds for government equities. By raising capital for onward lending to startups in the region, the bank could test whether commercial banks can support ventures requiring patience and local insights to grow.
Stanbic launched the Catalytic Fund in 2020 as part of its social impact strategy. The fund offers grant-like patient capital designed to de-risk early-stage ventures and help them scale sustainably. As of December 2024, the bank had disbursed KES182.4 million ($1.4 million) through the fund, with KES 63 million issued in 2024 alone, according to its disclosures.
Stanbic Bank CEO Joshua Oigara, had this to say, “We are in the market for $100 million (KES12.9 billion). We have learnt that if you keep just focusing on the businesses that are ready now, you are leaving 80% of the clients in the industry. We have to continue expanding the continuum by bringing such in.
“Energy projects tend to have the longest lead time from what we have seen, even 10 years. We’ve aligned with the biggest areas of the economy, like agriculture, because the model is similar, but energy projects tend to have the longest lead time,” Oigara said.