This archive report was first published on 24 October 2019.
On October 24, 2019, Jubilee Holdings, a regional listed underwriter, signed a partnership deal with Credit Bank to create loan financing and insurance products for small and medium-sized enterprises (SMEs) in East Africa.
The bancassurance model will allow the two firms to share information and formulate products that cater to the needs of SMEs, thereby growing their risk appetite.
According to Julius Kipng'etich, Jubilee's regional chief executive, the partnership will enable SMEs, which are mass employers, to expand their business while being insured.
Credit Bank's chief executive, Betty Korir, stated that the unified loan-cum-insurance products will be competitively priced, allowing the lender to disburse money for small to big-ticket deals and retain business that has previously been insured by foreign underwriters.
Trade finance accounts for 35 percent of Credit Bank's SME loan business, which has seen the lender pay premiums to foreign underwriters in the past. This business will now be channeled to Jubilee, giving the insurer access to information that helps tailor-make products suited to local SMEs.
Credit Bank aims to achieve tier II status by the end of the year, and the partnership with Jubilee is expected to contribute to this goal. Dutch Private equity fund Oiko Credit recently acquired a 22.8 percent stake in Credit Bank for Sh1 billion.
