MSE finance

January 20th, 2021

A vibrant and expanding small business sector can be a major catalyst of inclusive growth but Micro and small enterprises (MSEs) have a difficult time accessing the financial services that can fuel that growth. In Kenya, MSEs make a substantial contribution to livelihoods and inclusive growth in Kenya. They account for 24% of the country’s gross domestic product (GDP), over 90% of private sector enterprises and 93% of the total labour force in the economy. Partly due to their informality, however, they continue to face numerous challenges not least of which is their invisibility and neglect by public and private sector.

Recent policy initiatives reflect growing interest in MSEs, recognising that creating an enabling environment for MSE growth is a key priority. FSD Kenya is supporting the financial sector to overcome constraints in delivering appropriate financial products and services to MSEs. Our research in this area seeks to understand characteristics of the overall credit market for MSEs on the supply side, and the financing gap that needs to be addressed on the demand side. We also work in partnership with banks to assist in strengthening the policies and practices underpinning financial products offered to their MSE clients.

 

Key Resources

Supporting SMEs through action research
Resources for delivering enterprise finance
FinAccess Business – Supply: Bank Financing of SMEs in Kenya

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