Ruto unveils industrialisation fund to offer Kenyans single-digit interest loans

President pledges affordable financing for manufacturers as Kenya targets 20% GDP contribution from industry by 2030

By Yvonne Wambui

President William Ruto has announced plans to establish an Industrialisation Fund that will offer Kenyan manufacturers loans at single-digit interest rates, in a move designed to lower borrowing costs, stimulate local production and create jobs across the country.

Ruto made the announcement at the Industrialisation Summit and Changamka Kenya Shopping Festival held at the Kenyatta International Convention Centre in Nairobi. He said the government was in the final stages of setting up the fund and that details would be communicated soon.

“Improving access to affordable financing is central to our industrialisation agenda,” Ruto said, adding that high borrowing costs had for too long prevented businesses from growing and competing with cheaper imported goods.

The fund is intended to serve both new entrants into manufacturing and established producers looking to expand operations, acquire modern equipment and increase output. For many small and medium-sized enterprises that have long been shut out of formal financing, the announcement offers a rare glimmer of hope.

Kenya’s manufacturing sector has historically been constrained by expensive credit. Commercial bank lending rates have hovered well above 15 per cent in recent years, making it nearly impossible for smaller manufacturers to plan long-term investments or compete on price against imported goods flooding local markets.

Ruto reaffirmed his administration’s target of growing the manufacturing sector’s contribution to gross domestic product from 7.1 per cent, recorded last year, to 20 per cent by 2030. He also said the government was aiming to create one million jobs through industrial expansion and greater investment in domestic production.

Beyond financing, Ruto challenged Kenyans to consciously choose locally made products, arguing that buying Kenyan was not simply an act of patriotism but an economic decision that would sustain livelihoods and build a stronger industrial base.

The summit, which drew more than 400 exhibitors, gave manufacturers a platform to display locally produced goods, engage potential buyers and forge new business relationships. The Changamka Festival component was designed to connect producers directly with consumers, reinforcing the government’s broader push to shift purchasing habits away from imported products.

Ruto also proposed a Green Investment Fund targeting approximately KSh26B to support environmentally sustainable investments, signalling that the administration intends to align its industrial ambitions with climate considerations.

However, critical details around the Industrialisation Fund remain unclear. The application process, eligibility criteria, loan limits and repayment terms have yet to be formally announced, leaving businesses and entrepreneurs waiting for the specifics before they can plan accordingly.

The proposal has nonetheless generated genuine interest in business circles, with many manufacturers cautiously optimistic that the fund could mark a turning point for an industry that has long been overlooked in national economic planning.

For the fund to deliver on its promise, implementation will matter as much as intent. Kenya has seen similar pledges before. What businesses are watching for now is not the announcement, but the action that follows.

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