Kenyan SMEs are at the forefront of the digital payment revolution, with 84% acknowledging that investing in payment technologies is essential for growth. Notably, 68% of SMEs already accepting digital payments plan to further invest in technologies such as contactless payments, reinforcing the shift toward a cashless economy.
However, a significant opportunity remains in transitioning cash-only businesses to digital platforms. The report highlights that 56% of cash-reliant SMEs lose customers because they do not carry cash, while 91% face security risks like robbery and employee theft. These challenges underscore the benefits of secure, convenient, and transparent digital payments.
Why SMEs Are Embracing Digital Payments
Although cash remains widely used, the advantages of digital payments are becoming increasingly evident. Kenyan SMEs that have adopted card and mobile payments report significant benefits, including:
- Greater Customer Convenience – Faster transactions and seamless checkouts.
- Improved Sales and Revenue – Attracting a broader, cashless customer base.
- Better Business Management – Simplified accounting, inventory tracking, and financial planning.
- Enhanced Security – Reduced risks associated with handling large amounts of cash.
- Multi-Currency Transactions – Easier cross-border trade and international payments.
The momentum for digital payments is undeniable, with 40% of SMEs adopting digital payment solutions within the last two years. Key drivers of this shift include convenience (40%), cost savings (38%), and improved efficiency (37%).
Addressing Security Concerns and Enhancing Trust
Despite the widespread adoption of digital payments, security remains a top priority. Nearly all SMEs using digital payments (97%) still have concerns about cash-related security threats. Additionally, 71% of SMEs express a need for secure business-to-business (B2B) payment solutions, while 69% seek expert guidance on payment security best practices. Visa’s research highlights the demand for stronger security measures to foster greater confidence in digital transactions.
The Economic Impact of Digital Payment Adoption
Beyond individual business benefits, digital payments play a crucial role in Kenya’s economic growth and financial inclusion. Digital transactions enable unbanked populations to participate in the formal financial system, unlocking access to credit, savings, and insurance. Studies indicate that digital payment adoption can drive annual GDP growth by 1-2%, with a 1% increase in card usage generating approximately $67 billion in additional goods and services consumption across global markets.
Visa’s Commitment to Advancing Digital Payments in Kenya
Visa remains a key partner in Kenya’s digital transformation, offering tailored solutions for businesses, financial institutions, and government agencies. Through innovations like Tap to Phone, Contactless Payments, and Click to Pay, Visa empowers businesses to enhance their digital payment capabilities. Additionally, Visa provides educational resources and strategic programs to accelerate digital adoption across various merchant segments.
Final Thoughts: A Digital Future for Kenyan SMEs
Kenya’s digital payments landscape is evolving rapidly, driven by the increasing preference for secure, efficient, and innovative payment solutions. As SMEs continue to embrace digital transactions, they unlock new opportunities for business growth, operational efficiency, and enhanced customer experiences. With Visa’s support, Kenya is well-positioned to become a leader in digital payment adoption, fostering a more inclusive and prosperous economy.
As digital payments gain momentum, now is the time for SMEs to invest in secure and efficient payment technologies to stay ahead in an increasingly cashless world.
