Co-op Bank in a Sh500m deal to finance water providers

Co-operative Bank has signed a Sh500 million deal with water providers in a significant step forward in improving water and sanitation services in Kenya.

This collaboration aims to catalyze funding for medium-sized infrastructure projects in the Water, Sanitation, and Hygiene (WASH) sector.

The partnership unveils a results-based financing programme with an elaborate Technical Assistance Support system to grow a WASH portfolio in Kenya.

The arrangement will see the lender provide over Sh500 million in loan facilities to Aqua for All, Water .org and Water and Sanitation Services Provider Association (WASPA) to finance viable water supply and sanitation projects to enable more communities to have access to clean drinking water and improved sanitation services.

The lender will also issue loan rebates upon successfully implementing the projects and after servicing their loan facilities.

It will also issue a six-month moratorium on principal loan repayment during the project construction phase before servicing its principal loan installments.

Beneficiaries of the facilities will also access low-cost financial resources, helping ease the financial burden associated with project implementation.

The bank has committed to providing comprehensive technical support including training and capacity building for project implementers to ensure they have the necessary skills and knowledge.

It will also offer assistance in developing bankable project proposals, alongside ongoing project monitoring and evaluation support.

Speaking at the event Lydia Rono, the Bank’s director for Corporate and Institutional Banking at Cooperative Bank said the bank is excited about the alignment of vision among all partners, who have extensive experience and expertise in their respective areas crucial for effective financial, technical and infrastructure support.

She added that the engagement would in the long term improve the lives and livelihood of our communities in various parts of the country through improved water and sanitation services.

“Aqua for All will support the bank to disburse Sh500 million to finance at least 15 infrastructure projects which will enhance access to safe drinking water and improved sanitation for 50,000 people in Urban, Peri-urban and rural populations in Kenya,’’ Ms Rono said.

Francis Musinguzi, the Africa Regional director at Water.Org explained that the technical assistance funding from Water.org will support at least 15 WSPs in developing bankable project proposals, which they will submit to the Co-operative Bank of Kenya when applying for commercial loans.

“We will hire qualified national consultants to work with the pre-qualified WSPs to develop the bankable project proposals while at the same time providing capacity-building skills to the WSPs technical teams and the Co-op Bank’s projects financing team on project proposal development, assessment or validation, financing, monitoring of project implementation and recording of the project impacts realized i.e. the outputs, outcomes and people reached”.