Kenyaâs move towards a cashless Kenya economy is picking up speed, and SMEs are right at the heart of it. The rise of digital payment options like mobile money and contactless solutions is creating an exciting space for businesses to grow and thrive. A recent Visa report, âValue of Acceptance: Understanding the Digital Payment Landscape in Kenya,â highlights just how crucial digital payments have become. According to the report, 84% of SMEs see digital payments as key to their growth, and 68% of those already using them are planning to invest even more, especially in contactless options.
More and more businesses are going cashless because itâs simply easier, safer, and in tune with what customers want. Over half of cash-only SMEsâ56% to be exactâhave lost customers because people didnât have cash on hand. On top of that, businesses relying on cash are more vulnerable to theft and financial mismanagement, with 91% of them worried about security. Digital payments provide a smart alternative, cutting down risks and helping businesses operate with more peace of mind. They also make bookkeeping easier, streamline sales tracking, and improve customer experience. Plus, digital transactions give businesses valuable insights into customer spending habits, which can help fine-tune marketing strategies and stock management.
Mobile money platforms like M-Pesa, Airtel Money, and Equitel are leading Kenyaâs digital payment scene, making transactions smooth and accessible. Digital payments donât just make life easier for customers; they also save businesses money by reducing costs tied to handling cash, banking fees, and counterfeit risks. The benefits are clearâ69% of SMEs using fintech solutions are happy with them, showing just how useful these services have become. Another major plus is that going digital makes it easier for SMEs to get credit. Since digital transactions create clear financial records, banks and lenders can assess business performance more accurately, giving SMEs a better shot at securing loans to grow their operations.
Of course, itâs not all smooth sailing. Some businesses worry about transaction fees eating into their profits, while others face challenges with digital literacy. Technical issues like network outages and cybersecurity risks are also concerns. But even with these hurdles, Kenyaâs cashless momentum isnât slowing down. In fact, 40% of SMEs have gone digital in the last two years, and even those already using digital payments still worry about cash-related security issues. Thereâs also a growing demand for safer business-to-business (B2B) payment solutions, with 71% of SMEs looking for better security measures and guidance.
Kenya is well on its way to becoming a fully cashless Kenya economy, and this shift is bringing big benefits, from better financial inclusion to a more efficient business environment. Research suggests that going digital could add 1-2% to annual GDP growth, and just a 1% increase in card payments could lead to a $67 billion boost in spending on goods and services globally. With SMEs at the forefront of this digital revolution, businesses stand to gain more revenue, happier customers, and stronger financial footing. The future of commerce is digital, and Kenya is showing the world how itâs done.
