Africa-Press – Kenya. KCB Bank Kenya has secured a major boost in its climate financing agenda after receiving approval for a $96.9 million (Sh12.5 billion) facility from the Green Climate Fund.This sets the stage for a meteoric push into green lending targeting small businesses and farmers.
The funding, approved under the Climate Smart Technology (CST) programme, will be channeled through KCB Bank Kenya as a blended-finance package combining concessional loans, guarantees, and grants.
The initiative is designed to unlock access to affordable financing for Micro, Small and Medium Enterprises (MSMEs) and smallholder farmers, segments widely viewed as the backbone of Kenya’s economy but among the most vulnerable to climate shocks.
The programme will prioritise investments in climate-resilient agriculture, renewable energy and clean technologies, with a strong emphasis on inclusivity across value chains and gender.
Key interventions include the adoption of solar-powered solutions; clean cooking technologies, waste management systems, circular economy innovations and energy efficiency upgrades.
About 60 per cent of the funding will go towards adaptation measures such as water management and climate-resilient farming. In comparison, the remaining 40 per cent will support mitigation efforts, including renewable energy and energy efficiency projects.
The goal is to help communities build resilience, improve productivity and transition to low-carbon development pathways.
KCB Group chief executive officer, Paul Russo, described the approval as a transformative milestone in scaling climate finance across Kenya.
“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,” he said.
He added that the bank aims to equip communities with the tools, technologies and financing needed to withstand climate-related shocks.
Through the facility, KCB plans to roll out flexible credit products, blended financing structures and digital lending platforms to reach underserved populations at scale.
This approach is expected to significantly deepen financial inclusion while accelerating green adoption.
The programme aligns with Kenya’s National Climate Change Action Plan (NCCAP) III 2023 and its updated Nationally Determined Contribution (NDC), reinforcing the country’s commitment to climate mitigation and adaptation.
Catherine Koffman, director of the Africa Region at the Green Climate Fund, said the initiative directly addresses one of the most persistent barriers to climate action—limited access to finance.
“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,” she noted.
The approval comes at a critical time for Kenya, where more than 80 per cent of the landmass is classified as arid and semi-arid.
These regions frequently endure prolonged droughts and extreme flooding, with climate-related losses estimated at about three per cent of GDP annually.
Climate variability continues to pose a significant threat to livelihoods and food security.
Heavy reliance on rain-fed agriculture further compounds the risk, leaving farmers exposed to erratic weather patterns.
Against this backdrop, access to climate-smart technologies and affordable financing has remained a major constraint—one that the new facility seeks to address directly.
KCB’s latest move builds on its growing footprint in sustainable finance.
Last year, the lender assessed loans worth Sh578.3 billion for environmental and social risks, pushing its cumulative assessments past the Sh1 trillion mark since 2020 under its Environmental and Social Due Diligence framework.
The bank also disbursed Sh50 billion in green loans, expanding its green portfolio to 25.84 per cent from 15 per cent in 2023.
These investments have supported sectors such as e-mobility, the blue economy and climate adaptation initiatives.
The new GCF-backed facility is expected to further cement KCB’s position as a leading player in green financing, while advancing Kenya’s transition towards a more resilient, inclusive and low-carbon economy.
