The Kenya Association of Stockbrokers and Investment Banks (KASIB) on Thursday announced its plan to work closely with county governments to create alternative financing options.

The program will enable counties to access long-term financing at affordable rates and terms as compared to monthly bank loans.

The initiative will be anchored under various thematic areas including advisory services, Small to Medium Enterprise (SME) credit guarantees, public-private partnerships adoptions of a cap and trade system for carbon-based development projects and credit rating of county government.

“County executives, having well established their financial landscapes are well equipped to review alternative financing options that can be used to bridge the gaps and enable counties to achieve their goals," said Chairperson of KASIB board Donald Kamanguya.

“For this initiative to be successful, we also need to have a supportive infrastructure that includes an active bond market, sufficient investor interest and public-private- partner initiative.

"KASIB shall collaborate with other stakeholders, including county governments and private sector players to ensure that various inventions are well coordinated and resources are mobilized to support counties to access the capital markets,” added Kamanguya.

The association provided that for the counties to access capital markets to raise funds necessary for development financing, county governments will be required to be credit rated. Private capital shall be directed to each category of development based on risk profile.

KASIB will partner with credit rating entities which will play a significant role in ensuring counties are rated. KASIB will also offer advisory services to counties that want to issue bonds or any other financing option.

The counties can access up to Ksh.60 billion from the different types of bonds. Through the initiative, County Governments shall be able to raise funds from financial markets for the purpose of establishing credit guarantee schemes for their local SMEs.