Kenya joined the world in marking the International Micro, Small, and Medium Entrepreneurship (MSME) Day in Kitengela, Kajiado County.
In a speech read on his behalf by the Principal Secretary, Susan Mang’eni, the Cabinet Secretary for Cooperatives and MSME Development, Simon Chelugui, said that MSMEs account for more than 90 per cent of all businesses and contribute to over 70 per cent of jobs globally in addition to generating 50 per cent of the world’s gross domestic product.
He noted that the MSME sector in Kenya constitutes 98 per cent of all businesses, creating 30 per cent of the jobs annually as well as contributing 3 per cent of the 6.4 per cent annual GDP growth.
The CS said that the sector creates employment for over 16 million people, making it a high-priority segment in the realization of the Kenyan Government’s Bottom-up Economic Transformation Agenda.
He added that through the Ministry, the Government’s flagship project, the Financial Inclusion Fund (Hustler Fund), has been addressing the perennial challenge of lack of affordable and accessible credit for MSMEs.
The Cabinet Secretary said that through leveraging digital technology and support from Mobile Network Operators, the Hustler Fund has so far rolled out two products dedicated to Individuals (Personal Finance Product) and Collectives (Group Micro Loan Product).
“The personal finance product has had tremendous success, with over Sh 31.8 billion having been disbursed to over 20.5 million Kenyans, with a total repayment of over Sh 21.3 billion representing over 66 per cent. This product has over 7 million repeat customers, which signifies the relevance of the fund to the ordinary citizen. The Group Micro Loan product, which was launched on June 1, has so far disbursed over Sh64.5 million, with over 257,656 MSME groups having been created,” said the CS.
While noting that the fund aims at realizing financial inclusion for millions of Kenyans, particularly MSMEs, who would otherwise be excluded from the mainstream financial system, the CS revealed that the Fund will have two additional products to cater for SMEs and startups.
“To enhance financial inclusion for MSMEs, Kenya Industrial Estates (KIE) provides affordable medium- to long-term finance (up to Sh20 million) to MSMEs in the manufacturing sector with a focus on value addition. Through the Uwezo Fund, women, youth, and persons with disabilities are able to access finances to promote businesses and enterprises at the grassroot level (constituencies). In addition, the Youth Enterprise Development Fund provides affordable credit to youth-led businesses in order to mainstream their participation in economic growth,” he said.
The Ministry has also prioritized key value chains within the economy that exhibit high growth potential, have sustainable job creation, and cater to a significant portion of the population. These strategic sectors include Agro-processing, leather, textiles, milk production, edible oils, and construction materials.
“With a clear focus on these sectors, the Ministry is committed to enhancing cottage-level manufacturing with common user machinery to refine their production processes and facilitating the aggregation of MSMEs, leveraging the existing network of over 200 Constituency Industrial Development Centres (CIDCs) run by the Micro and Small Enterprises Authority, to support and promote value addition within these industries,” said the CS.
Chelugui also noted that there is a need to put emphasis on MSME activities and innovations that focus on green energy and environmental conservation, as Green Entrepreneurship is definitely the way to go.
The event also featured machine distribution to MSME associations across various value chains in the county.
The theme for this year’s MSME Day was ‘Galvanizing MSMEs Worldwide by Supporting Women and Youth Entrepreneurship and Resilient Supply Chains.’
By Diana Meneto
