Co-operative Bank of Kenya has entered into a new partnership with the United Nations Capital Development Fund (UNCDF) in a move aimed at expanding access to finance for Kenya’s digital entrepreneurs and climate-focused agricultural businesses.
The collaboration introduces a shared-risk lending facility under the Digital Platforms Kenya Programme (DigiKen), designed to support youth-led and digitally enabled small businesses over the next two years.
The initiative will support a lending portfolio of KES 233.1 million (USD 1.8 million) for the digital component alone.
The bank stressed that nothing has changed in its lending discipline. Credit decisions will remain entirely under its control, and its standards will stay intact. The difference is that more businesses, especially those in the digital economy, can now access financing with reduced risk support from UNCDF.
In practical terms, this means startups running online platforms, tech-enabled services, and digital ventures may have a better shot at formal credit, provided they meet the bank’s requirements. For many young entrepreneurs, that could be the financial “yes” they have been waiting for.
Vincent Marangu, Director of the Co-operatives Banking Division at Co-operative Bank, said the partnership reinforces the bank’s long-standing approach to responsible growth.
“This partnership is about expanding what is possible for Kenyan businesses and backing them with real capital,” he said.
Adding;
“Co-operative Bank has always believed that disciplined, responsible lending and genuine financial inclusion are not in conflict. Working with UNCDF gives us the means to prove that at scale.”
He added that the bank is focused on supporting commercially viable businesses that are ready to grow and scale, noting that many entrepreneurs simply need structured financing to move to the next level.
UNCDF described the guarantee facility as a way to reduce lending risks and encourage financial institutions to extend credit to underserved enterprises.
The institution emphasised that strengthening access to finance helps drive job creation, business expansion, and broader economic development.
Beyond the digital economy, the partnership also supports agriculture through the Kenya Post-Harvest Solar Cooling Programme, widely referred to as the Cold Chain programme. This component will finance solar-powered cold storage and post-harvest infrastructure for agri-SMEs, co-operatives, and rural processors.
The goal is to cut post-harvest losses, especially for farmers dealing with perishable produce. By supporting solar-based cooling solutions, the programme also aligns with Kenya’s push toward renewable energy and climate resilience.
When combined, the DigiKen and Cold Chain initiatives will support a total lending portfolio of Ksh 756 million (USD 5.84 million). That figure represents a significant injection of capital into two sectors that are critical to Kenya’s future — technology and agriculture.
Omon Ukpoma-Olaiya, Regional Investment Team Lead for East & Southern Africa & Arab States at UNCDF, said access to affordable finance remains one of the biggest challenges for MSMEs in the digital platform economy.
Through the guarantee facility, he explained, UNCDF will help unlock capital while enabling banks to expand credit responsibly. The partnership, he noted, supports market development, financial sector deepening, and sustainable economic growth.
Regional digital hub
The timing of the announcement reflects Kenya’s growing reputation as a regional digital hub. From mobile-based businesses to online marketplaces, the country’s young entrepreneurs are increasingly building ventures in the digital space. However, access to structured financing has often lagged behind innovation.
At the same time, climate change and food losses continue to affect farmers across the country. The Cold Chain programme aims to address that gap practically with solar-powered storage that keeps produce fresher for longer and reduces waste.
By linking digital inclusion with green finance, the partnership places Co-operative Bank at the intersection of two major national priorities: technological growth and environmental sustainability.
In simple terms, the deal is about giving ambitious businesses more room to breathe, whether they are coding from a co-working space in Nairobi or storing vegetables in a rural co-operative.
For entrepreneurs who have been pitching ideas, improving their models, and waiting for financing, this partnership could mean more doors opening and fewer waiting rooms.
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