11 December 2012

Kenya: Kangema Traders Protest Over SME Loans Initiative

Hundreds of Small and Medium Enterprises traders from Kangema yesterday took to the streets and demanded back the money they had contributed for the informal sector scheme initiated by the Finance ministry.

They called for the arrest of their chairman councillor Wachira Nguku for allegedly duping them to join the scheme. The traders said the money given to banks for lending to the sector should be returned to the Treasury because they have yet to get it.

Addressing the press yesterday at the General Kago Stadium, their leader James Mbuthia said K-Rep Bank should return the money the traders had deposited in the bank to qualify for the loans. He said the traders had deposited Sh600, 000 in the bank.

"The bank should give us our money and the rest of the informal sector cash given to the other banks by the government should be taken back to Treasury," said Mbuthia.

The controversy over the funds is pitting the informal sector members, many of who are small business owners and Jua Kali workers, and three banks -- K-Rep, Equity and Cooperative.

The traders accused the banks of sabotaging the Sh3.8 million revolving cash initiative, adding that the banks are undermining the government's efforts to revive the SMEs.

They said the banks are demanding high interest rates on the loans as opposed to the agreed 8 per cent and reducing the grace period before the start of repayment.

Mbuthia yesterday claimed that K-Rep Bank asked them to deposit Sh2, 000 from each group and Sh300 per person. However, confusion emerged after the protesters, who marched to the DC's Fredrick Muli office failed to present their grievances after their chairman vanished.

"How can we help you and who are your leaders?"asked an aid to Muli, who was not in the office at the time. The protesters, who were baffled by Nguku's disappearance, were advised to go and prepare a list of their grievances to present to the DC at another time. The traders abandoned the placards they had carried at the DC office as their early morning peaceful demonstration ended in futility.

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