Published On: August 22, 2022|Categories: News|

The pressure to run a successful healthcare business has never been greater. The sustainable growth of a healthcare business requires financing, yet many healthcare business owners and business managers struggle with attracting financing for their healthcare businesses. To bridge this gap, Strathmore University Business School (SBS) partnered with Sidian Bank and ICEA Lion Group to host a seminar exclusively for health entrepreneurs on the 29th of July 2022.

SMEs in Kenya still struggle to access capital to invest in their healthcare businesses despite the country boasting one of the most developed financial sectors in the region. Health care providers often lack critical business skills. Smaller health facilities are often operated by a single doctor or clinical officer and may not understand how to create structures and financial documents that are necessary to apply for loans. The lack of audited accounts and proper financial reporting processes in these small businesses can severely impact their ability to access financing. There is consensus that banks have become more open to the health sector than ever before. Health is viewed as a ‘growth’ sector with the rise in lifestyle diseases and the recent COVID-19 pandemic. Moreover, increased health insurance coverage and expansion of the National Hospital Insurance Fund (NHIF)’s benefit package have paved the way for more healthcare consumption and demand has risen.

The interactive seminar provided practical details and insights from experts on:

  • How to appraise the financial needs of a healthcare business;
  • What you need to have in place when looking for financing for your healthcare business;
  • The various types of financing available to a healthcare business;
  • How to prepare a pitch deck for a healthcare business.

Speaking during the seminar, Dr. Lucy Muturi, Faculty Member at SBS told the delegates, “In healthcare, you will never have enough money, you will always have scarce resources. However, one of the most powerful turnkeys to accessing finance is to have the right conversations.” The seminar provided a unique forum for health entrepreneurs and experienced financial advisors to discuss best practices and find solutions to problems raised by the delegates.

The healthcare sector has high capital requirements: to develop infrastructure, set up modern technical platforms and combine small structures to generate economies of scale. Companies in this sector therefore have considerable working capital requirements. Overhead costs are high and recurrent: staff costs, equipment maintenance, patient hygiene and safety, building maintenance, purchasing medicines, managing waste and other costs. The need for cash can be exacerbated by long delays in receiving payments from public and private insurance schemes companies.

Healthcare financing can improve the wellbeing of both patients and practices. The right financial partners can offer a wide range of appropriate financing instruments. Academic institutions also have a key role to play by imparting the right knowledge and skills to help entrepreneurs set up their businesses so that they can qualify for financing. As the demand for good quality healthcare increases, entrepreneurs can confidently set up profitable businesses and play their part to improve health outcomes in Kenya.

Article by Shailja Sharma, Executive Fellow and Coach

Would you like to share an article? Write to us at sbscommunication@strathmore.edu

Recent