Impact of the COVID-19 pandemic on micro, small, and medium enterprises (MSMEs)- Kenya report

• by Diana Siddiqui, Evelyne Matibe, Olivia Obiero and Anup Singh
• Jan 14, 2021
• 1 min
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This report highlights findings from the second round of the dipstick research jointly funded by MSC and SCBF. It captures a detailed analysis of the impact of COVID-19 on micro, small, and medium enterprises (MSMEs) and their coping strategies. The report further provides recommendations for policymakers and financial service providers to support MSMEs.

As the economy gradually re-opened in Kenya, micro, small, and medium enterprises continued to feel the effects of the COVID-19 pandemic and earn less than they used to. The relaxation of restrictions restored transportation routes and enabled the easier flow of goods across locations, which improved supply chains. However, the adverse economic impact of the pandemic has reduced the purchasing power of customers significantly and forced them to spend more cautiously. This presents a challenge for entrepreneurs, who have been dealing with depressed demand for goods and services and low revenues on one hand and struggling to meet the rising expenses of their business and household on the other. This report unravels the impact of the pandemic on micro and small enterprises and highlights their coping strategies. It also provides recommendations for policymakers, financial institutions, and donor organizations to help these enterprises build resilience and recover.