About 61% of Small and Medium Enterprises (SME’s) in Kenya are seeing positive signs of recovery following the unprecedented changes in the wake of the COVID-19 pandemic according to the latest research by Mastercard.
The inaugural Mastercard Middle East and Africa (MEA) SME Confidence Index found that 62% of SMEs in Africa are optimistic about the next 12 months, and 61% of SMEs in Kenya are seeing positive signs of recovery.
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As Kenya gradually begins staging its economic recovery, small and medium-sized businesses in the country have identified easier access to funding (73%), acceptance of digital payments, better data and insights, and digitizing business operations (72%) as the top three drivers for growth.
This highlights opportunities that arise from both internal transformations as well as industry regulations and trends.
Making sure that SMEs have all the support they need to go digital and grow digital is a key focus for Mastercard. The company works closely with various stakeholders including the government and banking institutions to create opportunities for SMEs, which represent 98% of all businesses in Kenya.
Mastercard has pledged $250 million and committed to connecting 50 million micro, small and medium-size businesses to the digital economy by 2025 using its technology, network, expertise, and resources in support of the company’s goal of building a more sustainable and inclusive digital economy.
For many small businesses, reducing their dependence on cash through digital payments acceptance has played a major factor in being able to get paid and maintain revenues.
“SMEs have been among those hit hardest by the pandemic, and Mastercard is dedicated to continuing support to this sector, especially in terms of connections to the digital payments acceptance tools, insights, and cyber secure tech solutions they need. Although challenges remain, the SME Confidence Index provides a helpful overview for all stakeholders on what we can do to grow the contribution of this sector in Kenya. It is very encouraging to see that the three Ds – data, digital payments, and digitized operations – are already actively in play among SMEs in Kenya as they position themselves for multi-dimensional recovery and growth,” said Shehryar Ali, Country Manager, East Africa, Mastercard.
buy antabuse pills The cost of business a key concern, whilst public and private partnerships seen as engines for growth
When asked about the main thing that keeps them up at night, 49% of SMEs in Kenya mentioned the challenge to maintain and grow their business was their top issue. Looking at concerns over the next 12 months, almost three-quarters (73%) identified the rising cost of doing business, while 44% cited access to capital.
Private sector partnerships (61%) and government-led initiatives (40%) were identified as having the biggest potential to positively impact SMEs and the wider Kenyan market.
“As SMEs in Kenya begin their path to recovery in a post-Covid world, their key concern is access to funding in order to maintain and grow their business. This can be achieved by leveraging the digital economy to drive greater inclusion by easing barriers to financial services. At Mastercard, we are committed to connecting businesses to the digital economy by working with partners to provide digital solutions and technology that will enable them to improve their operational efficiency, diversify their revenue and grow their businesses,” added Shehryar Ali.
As consumer trends evolve in a post-pandemic world, businesses must adapt and prepare for the future. Mastercard’s Economic Outlook 2021 estimated that 20-30% of the Covid-19 related surge in e-commerce would be a permanent trend in share of overall retail spending globally.
Furthermore, recent studies from Mastercard showed that 79% of Kenyan consumers are shopping more online than they did since the start of the pandemic and 99% of Kenyan shoppers would consider making a purchase with an emerging payment technology over the next year.