NAIROBI, Kenya, April 4– The Ministry of Investments, Trade, and Industry, and IFC have signed a Cooperation Agreement to provide technical support aimed at bolstering the adoption and uptake of the Warehouse Receipt System (WRS) in Kenya.
The project, estimated to cost USD2.3 million(Sh305.5 million), is expected to be completed by December 2025, and involves three key areas of work.
The first project component is to develop the regulatory framework and administrative instruments needed to govern the Warehouse Receipt System.
Second, will be the implementation of the central registry for the management of warehouse receipts.
Third, the partners will design and finance a development dialogue series that brings together various private and public sector stakeholders in partnership with the Media Council of Kenya to increase awareness of the warehouse receipt system amongst the public and boost participation in the Warehouse Receipt System.
The primary objective of the project is to strengthen the legal, regulatory, and operational framework of Kenya’s Warehouse Receipt System (WRS) with the aim of boosting warehouse receipt financing and increasing private sector participation and investments in the system.
Kenyan farmers have long grappled with food insecurity, post-harvest losses due to poor storage, aggregation, and post-harvest handling, limited access to markets, lack of effective and transparent price discovery mechanisms through a commodity trading platform, and lack of affordable credit.
A strong warehouse receipt system helps address these challenges.
Farmers and aggregators across the country can deposit their agricultural commodities in certified warehouses, in exchange for a Warehouse Receipt (WR) which can be traded, sold, exchanged, or used as collateral to obtain bank loans
“The Government is currently engaged in an aggressive campaign to increase food production under the fertilizer and seed subsidy programme, and WRS will help ensure this happens through the provision of quality storage and certified warehouse facilities once farm produce is harvested,” said Trade Principal Secretary Alfred K’Ombudo.
The PS further noted that the receipt reflects the quantity and quality of the commodity deposited at a certified warehouse and is transferable and negotiable hence can be used as collateral to secure credit for the farmers or cooperatives, and traders.
Kenya’s Warehouse Receipt System covers the entire process of depositing commodities in a licensed warehouse, the issuance of a warehouse receipt reflecting the quantity and quality of the deposited commodity, the management of the transfer of the receipt as a document of title, and includes, but is not limited to, the regulation of warehouses operators and actors associated in the processes.
IFC will provide technical assistance to develop and review institutional instruments such as administrative procedures orders, service level agreements, and standard operating procedures to govern the WRS Council.
“By enhancing the policies and procedures around Kenya’s Warehouse Receipt System, IFC hopes to grant farmers better storage facilities, enable them to fetch fair prices for their commodities and access credit for growth, thereby uplifting thousands of farmers,” said Amena Arif, IFC Country Manager for Kenya.
