Sunday, May 19, 2024

Study unveils insights into small firms’ financial behavior in a bid to drive economic growth

A recent study has revealed that 51 percent of the adult population in Kisumu County owns small firms, with 34 percent being male and 15 percent female entrepreneurs.

The study, conducted by the Kenya Small Firm Diaries and the Financial Access Initiative (FAI), aimed to shed light on the financial behavior of businesses in Kisumu County and provide valuable insights into their challenges and priorities.

Financial Sector Deepening (FSD) Kenya Director Anne Mutahi, shed light on the role of entrepreneurs, and financial service providers in providing SMEs and women improve their services through customized credit facilities.

We examine business ideas, magnify, look into the requirements, and ignite conversation with the community on agriculture, health, and safe environs in partnership with the counties and national government to accelerate funding processes

Ann Mutahi

“We examine business ideas, magnify, look into the requirements, and ignite conversation with the community on agriculture, health, and safe environs in partnership with the counties and national government to accelerate funding processes,” she said.

Economic Growth

While presiding over the launch of the findings at Sarova Imperial Hotel on Thursday, 25th May, 2023, Kisumu Deputy Governor Matthew Owili expressed his gratitude to the organizers of the research program for their efforts in generating groundbreaking data and facilitating cross-county comparisons.

Owili emphasized the crucial role played by small businesses as the engines of economic progress and the heart and soul of local communities.

He however acknowledged the severe impact of the COVID-19 pandemic on these businesses, leaving many struggling to survive.

“But you will agree with me that the covid pandemic crushed many small firms and left others hanging on the thread,” he said.

While highlighting the challenges faced by small firms in Kisumu, Owili identified issues such as data collection and transmission systems, business financing, human resources, essential infrastructure, and supply chain difficulties.

He assure the residents that the government is committed to addressing these challenges and revitalizing the business sector through strengthening service delivery and improving local business infrastructure were identified as primary goals.

The Deputy Governor also emphasized the need to enhance the timely availability of supplies, especially in peripheral areas, and streamline the logistical and last-mile supply chain processes.

One of the key challenges that we do recognize is the timely availability of supplies when needed by our community members in peripheral areas

Dr. Owili

Access to loans

Owili lauded the research findings as timely and instrumental in finding solutions to these problems.

Additionally, he expressed appreciation to the Small Firm Diaries team for their contribution in increasing business access in Kisumu County.

“One of the key challenges that we do recognize is the timely availability of supplies when needed by our community members in peripheral areas,”stated Owili.

Access to loans and capital investments emerged as major challenges for these firms.

He further highlighted the importance of the research in exploring models to improve access to trade credit and leverage information and assets to unlock working capital.

Overall, the launch of the study’s findings marked a significant step towards understanding and addressing the financial needs and challenges faced by small firms in Kisumu County, with a focus on improving their business outcomes and driving economic growth

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