Visa has announced the launch of a new report, ‘Value of Acceptance: Understanding the Digital Payment Landscape in Kenya,’ which reveals growth opportunities for digital payments, particularly among Small and Medium-Sized Enterprises (SMEs).
The report highlights a thriving digital payments ecosystem in Kenya, with 84% of surveyed SMEs recognizing that investing in payments technologies is crucial to drive business growth. This positive outlook is reinforced by the fact that 68% of SMEs currently accepting digital payments plan to invest further in payment technologies, including contactless solutions.
The report underscores a compelling opportunity to transition cash-only SMEs to digital payments by promoting their benefits. Currently, 56% of surveyed cash-only SMEs report losing business due to customers not carrying cash, while 91% facing cash-related security concerns such as robbery and employee embezzlement. Combined, these challenges highlight the potential of secure, convenient, and transparent digital payments.
While cash remains a familiar payment method, the study reveals the advantages of card payments including increased convenience for customers, simplified accounting and sales management, enhanced business reputation, valuable insights into spending habits, and support for multi-currency processing.
Kenya’s Digital Payments Momentum
The report highlights Kenya’s accelerating path toward broader payment acceptance, with 40% of SMEs having adopted digital payments in the last two years. This momentum is driven by the recognition that investments in payment technologies, including card payments alongside mobile and digital wallets, are essential for business growth. SMEs cite convenience (40%), cost savings (38%), and improved efficiency (37%) as key drivers for adopting digital payments.
While comfort with cash remains a barrier, the report reveals that nearly all digitally enabled SMEs (97%) still harbor cash-related security concerns. This presents a strong case for promoting digital payments as a safer and more efficient alternative. Furthermore, there is significant demand for enhanced security measures among businesses already accepting digital payments, with 71% expressing a need for secure B2B payment solutions and 69% seeking guidance on payment security best practices. The high satisfaction rate (69%) among SMEs already using financial technology further supports the continued expansion of digital payments in Kenya.
“Kenya’s digital payments landscape is experiencing a dynamic growth, fueled by a rising preference for innovative payment methods and value-added services that provide enhanced security and streamline operations” Chad Pollock, VP and General Manager, Visa East Africa stated.
“This shift presents a significant opportunity to boost both individual prosperity and broader economic development. By collaborating with our partners across the ecosystem, Visa aims to unlock the full potential of digital payments for all Kenyans, spanning individuals, merchants, and businesses of all sizes.”
The value of digital acceptance for SMEs
Digital payments are crucial for Kenyan SMEs, boosting revenue through a wider, increasingly cashless customer base, improving customer satisfaction with faster payments, and reducing operational risks by minimizing cash handling. Digital transaction records also provide valuable data that facilitates access to financing, thereby stimulating growth.
Beyond direct benefits, digital payment adoption drives economic growth and financial inclusion, connecting the unbanked to the formal financial system and enabling access to savings, credit, and insurance. Research shows that the transition to the digital economy can generate 1-2% annual GDP growth; a mere 1% increase in card usage generates an average $67 billion annual increase in goods and services consumption across 70 countries and territories1.
Visa: A Partner in Driving Digital Payment Adoption
Visa is uniquely positioned to support Kenya’s transition to a more digital economy. As a trusted advisor and partner, Visa offers a range of capabilities to help governments, financial institutions, businesses, and technology providers enhance their digital payment acceptance maturity. Visa’s suite of solutions includes programs for specific merchant segments, innovations like Tap to Phone, Contactless Payments and Click to Pay, and resources for educating businesses about the benefits of digital payments.
About the Visa Value of Acceptance report
Visa’s ‘Value of Acceptance: Understanding the Digital Payment Landscape in Kenya’ report, conducted by 4Sight Research & Analytics, examines the current state of digital payment acceptance, exploring both opportunities and challenges. The findings are based on face-to-face interviews with Kenya’s SME owners/managers who are key decision-makers with respect to day-to-day business decisions.
