Financing for Micro, Small, and Medium-sized Enterprises in Kenya

This K4DD Rapid Evidence Review assesses the recent academic and grey literature on the topic of financing for micro, small and medium-sized enterprises (MSMEs) in Kenya.

The literature reveals a dearth of highly-cited papers on the topic, and while there are a number of studies which are positive on the effectiveness of different types of financing on the performance of MSMEs, there is scope for further literature which engage with the potential risks or problems associated with different financing methods.

The literature demonstrates that the landscape for MSME financing in Kenya is relatively fragmented, with commercial banks dominating lending to MSMEs, but with a growing number of other lenders such as microfinance banks (MFBs), savings and credit cooperative organisations (SACCOs), and unregulated microfinance institutions (MFIs) and informal lenders.