mobile money2

SMEs Business Boom in Mobile Phone Cash

SMEs are on momentum as the reports from the Central Bank of Kenya (CBK) reports. Cash transactions through mobile phones have increased by more than Sh1 trillion in the six months to June, a decade-high growth that indicates recovery from Covid-19 pandemic. With other economic facilitators such as M-Pesa, Airtel Money and Telkom’s T-Cash recording a 52 percent rise in cash transactions, the SMEs being on spot for daily transactions.

According to the Central Bank of Kenya, Cash transactions that involve mobile transfers have increased by more than Sh 1 trillion in the last six months to June. These replicates a decade-high growth that indicates recovery from a battered economy with the pandemic. (Covid-19)

The report indicates that many SMEs have increased their mobile transactions since the pandemic hit the country last year march. While many people in the formal job sector lost their jobs resorting to opening their businesses, the internal exchange rate was ballooning slowly.


Also Read:

  1. “SMEs are still prime but not yet protected” – Experts say.
  2. 7 Easy Businesses Kenyan SMEs can now do in South Sudan
  3. How SMEs can fast-track their growth by going digital

One year, since the pandemic struck the country, the country began opening up the economy slowly by slowly as different sectors were given free flow in operations. The Covid-19 vaccines also encouraged SMEs to intensify their businesses operations as from relief.

“Indicators for the Kenyan economy point to a relatively strong GDP (gross domestic product) recovery in the first half of 2021, mainly supported by strong performance of construction, information and communication, education, and real estate sectors,” CBK governor Patrick Njoroge.

The Existence phase of SMEs

Last year march when the economy experienced a sudden shutdown, most SMEs sprouted with an aim of just Existing to meet their daily needs as hopes for Economic opening is kept.

SMEs in the Existence Stage range from newly started restaurants and retail stores to high-technology manufacturers that have yet to stabilize either production or product quality. Many such SMEs never gain sufficient customer acceptance or product capability to become viable. In these cases, the owners close the business when the start-up capital runs out and, if they’re lucky, sell the business for its asset value.

The restrictions, which the State imposed in March last year, included a ban of movement into and out of four counties, including Nairobi and Mombasa, suspension of international and domestic flights, closure of bars and eateries and a dusk to dawn curfew that cut operating hours for businesses and hit their sales.

Yet a little economic activities were experienced here. As reported by the CBK.

The Survival Phase.

With lost hopes of economic recovery, start-up SMEs began depending on their hustles for daily wages and meeting their bills per see, as little economic recoveries are experienced.

According to the CBK, the economic recovery started in the fourth quarter of last year, supported by agriculture, real estate and the financial sectors, months after Kenya eased the Covid-19 restrictions through phased re-opening of various sectors.

In reaching this stage, the SMEs had demonstrated that it is a workable business entity. It has enough customers and satisfies them sufficiently with its products or services to keep them. The key problem thus shifts from mere existence to the relationship between revenues and expenses.

Systems development is minimal. Formal planning is, at best, cash forecasting. The major goal is still survival, and the SME owners are still synonymous with the business.

According to many businesses in Mombasa and its outskirts, the focus on growth stood during this period as SMEs proved best with the situation.

E-commerce and mobile money began triumphing at this point since the government had announced that hard cash had been prohibited to avoid transmission of the virus.

The success of SMEs phase.

From early this year, most SMEs had already established themselves in the market. With customer utility, and mobile transactions now at its maximum, the advantage was on the economy.

As the CBK reports an increase in cash transfers in mobile phones, most SMEs now possess relevant apps and consumer money exchange platforms such as till numbers, pay bills among others. It’s quite clear that even in the transport sector where cash transactions was the order of the day and one of the largest GDP remitters to the national kitty, embraced the new style of operations.

Also Read:

  1. Go Get Paid! MSMEs New hope as Council of Governors announce County Fund release
  2. Kenya’s 2021-22 budget and its aim on MSMEs Fiscal accommodation
  3. Are MSMEs the only hope left that can stop Mombasa Becoming a Ghost Town?

At the success stage for SMEs, the decision facing owners at this stage is whether to exploit the company’s accomplishments and expand or keep the company stable and profitable, providing a base for alternative owner activities.

Thus, a key issue is whether to use the company as a platform for growth—or as a means of support for the owners as they completely or partially disengage from the company—making it a full franchise. Behind the disengagement might be a wish to start up new enterprises, run for political office, or simply to pursue hobbies and other outside interests while maintaining the business more or less in the status quo.

Central Bank of Kenya (CBK) data shows M-Pesa, Airtel Money and Telkom’s T-Cash agents handled Sh3.26 trillion, a 52 percent rise from Sh2.14 trillion in a similar period last year when Kenya was hit hard by the Covid-19 pandemic. The record value of mobile phone cash transactions reflects the continued economic recovery after the curbs that followed the pandemic shed jobs and led to business closure.

Mombasa, Kenya.

Do you have a groundbreaking story you would like us to publish? Please reach us through our email news TIPS to or WhatsApp +254712410460. You can also subscribe to get the latest news article on this


There are no comments

Add yours