The Market Insight study was based on wide consultations with industry stakeholders over a five-month period. The study centered on the Kenya credit ecosystem and the implications of using alternative data (non-traditional) to prudently extend credit access to micro and small enterprises (MSEā€™s) in Kenya.

The study acknowledges the availability of pockets of alternative data (not-traditional) available in different forms and structure such as data from payment service providers, transactional data from supermarkets, utility firms etc, supply chain data among others. The challenge has been how to effectively harness and integrate such data with traditional credit data to score and extend credit to MSMEā€™s in various sectors. The global MSME financing gap is currently estimated to be USD $ 52 trillion.

AFRACA was privileged to participate in the study jointly led by FinRegLab and CISKenya given the complementary nature of the study objectives to ongoing work in Digitizing Rural and Agricultural Finance (DIG4RAF). The study raised pertinent questions around regulatory challenges to expand to other data sources, lack of appropriate infrastructure to access and incorporate alternative data and identification of alternative data points that have greater impact on MSME lending.

More information on the study findings can be accessed via the link; FinRegLag Kenya Study

Photo (top of page): Hon. Susan Mang’eni, Principal Secretary of State Department of MSME Development, making her opening remarks during the kick-off meeting.

Photo: Participants during the plenary of Kick-off Workshop at Kenya School of Monetary Studies, Nairobi, Kenya