Monday, February 14, 2005

Matatu (PSV sector) financing

While NIC Bank is well known for its MOVE banking concept, its asset finance scheme has also been very popular for the Kenyan’s eager to enter the matatu business. The Michuki rules have made it easier for new entrants to break into what used to be a murky sector – and NIC has been the financier of choice. The Bank has allocated the PSV sector 35% of its asset finance portfolio. According to the Bank’s head of asset finance, Edna Kihara, the minimum loan amount is 300,000 and with loans processed within 48 hours, has proved to be very popular.

Other terms are that: (1) only new matatu’s financed - no used or ex-Japan vehicles (2) owner deposits 40% (3) 1-3 year loan (4) insure comprehensively (5) joint registration with NIC (6) commitment fee of 2%

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