FSD Kenya in partnership with the Kenya National Bureau of Statistics and the Central Bank of Kenya and FSD Kenya ran a survey of micro businesses (MSEs) to track the impacts of COVID-19 on this population. Based on a sample of microbusinesses drawn from the FinAccess 2019 household survey, the survey tracked key metrics such as business revenue, customer flow, employment, use of finance and challenges faced by MSEs between February 2020 (before the pandemic) and July 2021.
According to the State Department of Industrialisation, MSEs make up over 90% of businesses in Kenya and contribute 24% of GDP. However, due to their informal and decentralized nature, MSEs saw limited benefits from measures put in place by government and private sector to mitigate the economic impacts of the pandemic.
Consequently, the MSE COVID-19 tracker survey finds that both revenue and resilience of MSEs has been depleted with less than 40% recovering to their pre-COVID revenues. Others are still struggling, mainly due to continued suppressed customer demand. At the same time, the use of digital payments by MSEs for business purposes has increased during the pandemic, as well as the use of media (mainly phone and SMS) to reach customers.
This shows the potential for digitalisation to add more value for MSEs.
FSD Kenya would like to acknowledge the valuable analytical support provided by 71point4 for this survey.