KCB Bank Kenya has secured $96.9 million from the Green Climate Fund to expand climate finance, targeting MSMEs and farmers with clean energy, agriculture and resilience solutions nationwide.
KCB Bank Kenya has secured approval for $96.9 million in financing from the Green Climate Fund (GCF), marking a major push to scale climate investments for micro, small and medium enterprises (MSMEs) and smallholder farmers across the country.
The funding package blends concessional loans, a guarantee and a grant under the Climate Smart Technology (CST) programme. It is designed to support some of Kenya’s most vulnerable communities as they confront growing climate risks.
The facility will back value chain and gender inclusive interventions, focusing on the uptake of solar powered solutions and clean cooking technologies, climate smart agriculture, waste management and circular economy models, along with energy efficiency improvements. The goal is to strengthen resilience, boost productivity and accelerate the shift to low carbon practices.
About 60 percent of the investment will be directed toward adaptation measures, particularly climate resilient agriculture and water management technologies. The remaining 40 percent will target mitigation efforts such as renewable energy and energy efficiency. KCB Bank Kenya plans to deploy flexible credit products, blended finance structures and digital lending platforms to reach underserved populations at scale.
KCB Group Chief Executive Officer Paul Russo described the initiative as a significant milestone in expanding access to climate finance.
“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,” he said.
The programme aligns with Kenya’s National Climate Change Action Plan (NCCAP) III 2023 and its updated Nationally Determined Contribution (NDC).
Catherine Koffman, Director of the GCF’s Africa Region Department, said the project tackles a key barrier to climate action.
“The climate smart technologies for micro, small and medium sized enterprises and farmers project addresses one of the toughest barriers to climate action: access to finance for small businesses and farmers. By crowding in private capital and de risking climate smart investments, GCF finance will empower Kenya’s MSMEs and farmers to adopt solutions that strengthen resilience, productivity and long term economic stability. The investment reflects GCF’s ability to unlock private investment to deliver capital at scale and the Fund’s commitment to be Kenya’s climate partner of choice,” she said.
The approval comes as Kenya faces acute climate vulnerability, with more than 80 percent of its land classified as arid and semi arid lands. These areas are prone to prolonged droughts and extreme flooding, resulting in significant economic losses.
Nearly 46 percent of the population lives below the poverty line. Agriculture contributes 26 percent to the country’s GDP and employs 70 percent of the rural workforce, making climate disruptions a major threat to livelihoods, food security and economic stability. Heavy reliance on rain fed agriculture further increases exposure to erratic weather patterns, while MSMEs and farmers continue to face limited access to climate smart technologies, financing and adaptation strategies.
KCB Group has continued to expand its climate and sustainability portfolio. Last year, the bank assessed loans worth KShs 578.3 billion for environmental and social risks, bringing the cumulative total since 2020 to more than KShs 1 trillion under its Environmental and Social Due Diligence process.
It also disbursed KShs 50 billion in green loans, increasing its green portfolio share to 25.84 percent from 15 percent in 2023. These investments supported initiatives in the blue economy, e mobility and climate change adaptation, reinforcing the bank’s role in advancing green finance and financial inclusion.
