Digital payments ignite a new era of hope for SMEs in Kenya

February 10, 2023 | By Shehryar Ali
Micro, small, and medium enterprises (MSMEs) are the lifeblood of economies. In Kenya, they account for 80% of jobs. In 2021 alone, an estimated 22 million jobs in Africa were lost, mainly due to the COVID-19 pandemic, and with each loss of a stable income, more people were pushed into extreme poverty. It’s a devastating cycle that can only be broken with multiple actions – with technology and partnerships at the top of the list – as this challenge cannot be tackled alone. 

One silver lining for SMEs during this trying period was the increased rate of digitalization. At a time of limited mobility, more small businesses realized the necessity of selling online and getting paid digitally. This reminds me of the old Kanga saying: “The value of light is noticed when night falls.”

By now, the case for digital transformation is well-established. Access to digital tools, relevant knowledge, credit, and resources are key not only to the growth of MSMEs but to their very survival. Small businesses are recognizing the practical benefits of digitalization in day-to-day operations, as opposed to viewing it as a long-term project for the future.

With every passing day, the digital economy is increasingly becoming the economy. That is why digital inclusion is so critical.

Ensuring that small businesses can capitalize on this trend is something Mastercard is very passionate about. We have pledged to bring 1 billion people and 50 million MSMEs into the digital economy by 2025.

Access to credit is one way of doing it. Digitalization of MSME operations generates valuable data that enables financial institutions to make more informed decisions about extending credit – one of the key challenges for small businesses.

An example of Mastercard’s Track Micro Credit Program, fueled by digital transaction data from the beneficiaries, can be seen in Kenya’s Jaza Duka. This inclusive credit ecosystem provides small shop owners with short-term credit and digital payment capabilities to allow them to stock their shelves without having to rely solely on cash, empowering them to reach their true potential.

At Mastercard, we’re leveraging technology, innovation, and solutions beyond payments to help SMEs get paid, get capital, and get digital – safely and securely – wherever they are.

Photo of Shehryar Ali
Shehryar Ali, Country Manager, East Africa