KCB Secures $96.9M GCF Financing to Drive Climate-Smart Technologies for Farmers and MSMEs
KCB Bank Kenya has received approval for a $96.9 million (KShs. 12.5 billion) financing facility from the Green Climate Fund aimed at accelerating green projects for Micro, Small and Medium Enterprises (MSMEs) and farmers across Kenya.
The financing, structured as a blended package of concessional lending, guarantees, and grants under the Climate Smart Technology (CST) programme, seeks to support Kenya’s most vulnerable communities while enhancing the adoption of sustainable practices.
Through the initiative, MSMEs and farmers will gain access to clean cooking solutions, solar-powered technologies, climate-smart agriculture, energy efficiency measures, and waste management and circular economy solutions, enabling them to build resilience, improve productivity, and transition to low-carbon practices.
Approximately 60 percent of the investment will target adaptation, focusing on climate-resilient agriculture and water management technologies, while 40 percent will support mitigation through renewable energy and energy efficiency solutions.
The programme will also deploy innovative financing mechanisms, including flexible credit products, mixed finance structures, and digital lending platforms, to ensure that underserved populations are reached at scale.
Paul Russo said, “This is a bold step to scale climate finance. By targeting MSMEs and smallholder farmers, we are ensuring that no one is left behind in the transition to a climate-resilient future. Our goal is to empower these communities with the tools, technologies, and financing they need to thrive in the face of climate change threats.”
Catherine Koffman added that the initiative addresses one of the biggest barriers to climate action: access to finance for small businesses and farmers.
She emphasized that by crowding in private capital and de-risking climate-smart investments, the GCF financing will allow Kenya’s MSMEs and farmers to adopt solutions that strengthen resilience, productivity, and long-term economic stability. The investment also reflects the Fund’s commitment to being Kenya’s partner of choice in climate finance.
The approval comes at a critical time, as over 80 percent of Kenya’s landmass is classified as arid and semi-arid (ASALs), exposing the population to frequent climate hazards such as prolonged droughts and extreme flooding. These disruptions are estimated to cost the country approximately 3 percent of its GDP annually.
With agriculture contributing 26 percent to GDP and employing 70 percent of the rural workforce, climate change impacts livelihoods, food security, and economic stability.
Reliance on rain-fed agriculture further increases vulnerability, and MSMEs and farmers often struggle to access climate-smart technologies and financing.
This initiative is aligned with Kenya’s National Climate Change Action Plan (NCCAP) III 2023 and the updated Nationally Determined Contribution (NDC), reinforcing the country’s ambition to transition to a green and inclusive economy.
KCB Group has also demonstrated a strong track record in climate finance, having assessed loans worth KShs. 578.3 billion for environmental and social risks last year, bringing cumulative assessments since 2020 to over KShs. 1 trillion under the Group’s Environmental and Social Due Diligence (ESDD) framework.
The bank disbursed KShs. 50 billion in green loans, expanding its green portfolio to 25.84 percent from 15 percent in 2023. These investments support green products targeting energy transition, climate adaptation, e-mobility, and the blue economy.
Through this financing, KCB Bank Kenya positions itself as a critical enabler for climate-smart development, empowering MSMEs and farmers to adopt sustainable solutions, strengthen productivity, and enhance economic resilience while contributing to Kenya’s low-carbon growth agenda.