Tough Times as Number of Online Businesses Reduce- Survey
According to the Central Bank of Kenya’s (CBK) FinAccess Micro and Small Enterprises Tracker Survey for August 2023, the number of online businesses and Kenyans operating their businesses from home decreased in June 2023, falling from 19.1% in October 2022 to 17.8% in June 2023.
During the period under review, the number of individuals conducting business in open markets and without official business premises, such as hawkers, increased from 26.6% to 29.3%, according to the survey.
Similarly, the number of enterprises operating in commercial properties, such as offices and industrial sites, increased from 30.1% in October 2022 to 31.8%.
“The location where a business operates influences its growth. Commercial premises and hawking are the main premises from which the business reported from,” the report read in part.
The number of Jua Kali shelters, market stalls, and kiosks decreased to 21.1% from the 24.2% recorded in October 2022, according to a survey conducted by CBK.
The process of digitization
During the period under review, the proportion of MSEs utilizing digital channels increased, according to the report.
The percentage of MSEs using at least one digital channel for business transactions increased from 73.5% in October 2022 to 85.6% in June 2023, according to the report.
The report found that digitalization rates were significantly higher among businesses owned by women, located in urban areas, and operated by their proprietors, compared to businesses owned by men, located in rural areas, and with one to nine employees.
In addition, the report revealed that respondents between the ages of 18 and 25 had a greater propensity to utilize digital channels than respondents in other age groups.
The majority of consumers continue to prefer cash transactions with MSMEs, according to the findings of the survey.
According to the report, 98.5 percent of transactions were conducted with currency.
In its proposed Finance Act 2023, the government imposed a 5% tax on online content creators, which, according to experts, could result in a further decline of online enterprises in Kenya.
Tough Times as Number of Online Businesses Reduce- Survey
