Kenyan Traders Rapidly Adopting Mobile Payment Systems, New Data Shows
Kenyan small-scale traders and informal sector businesses are embracing mobile payment systems at an unprecedented rate, fundamentally transforming the country’s retail landscape. According to new data from the Communications Authority of Kenya, mobile money transactions among small businesses grew by 42% in the past year, with micro-enterprises now accounting for over 35% of all merchant payments processed through mobile platforms. This rapid adoption is creating a more efficient, transparent, and secure business environment while significantly reducing the risks associated with cash transactions.
The shift is particularly evident in markets across Nairobi, Nakuru, Mombasa, and Kisumu, where traders are increasingly displaying till numbers and QR codes alongside their merchandise. From vegetable vendors in Gikomba to artisans in Maasai Market, small business owners report that digital payments have revolutionized their operations. Since I started accepting mobile payments six months ago, my sales have increased by nearly 30%, explained Grace Wanjiku, who sells handmade baskets at Nairobi’s City Market. Customers who don’t carry cash can still buy from me, and I no longer worry about theft or having to make frequent bank deposits. The transaction records also help me track my daily sales accurately.
The trend is being driven by several factors, including the widespread penetration of smartphones, competitive transaction fees from mobile network operators, and growing consumer preference for cashless payments. Financial technology companies have also developed specialized solutions for small businesses, including integrated inventory management and digital record-keeping tools that work alongside payment systems. What we’re witnessing is the digital formalization of Kenya’s informal sector, noted Michael Onyango, a financial inclusion expert at Strathmore University. As traders adopt these digital tools, they’re not just changing how they get paid—they’re building financial histories that could eventually help them access credit and other formal financial services.
While the adoption rate is impressive, challenges remain, including network connectivity issues in some rural areas and concerns about transaction costs eating into already thin profit margins. However, industry experts predict that continued innovation and competition among service providers will address these concerns. The mobile payment revolution that began with person-to-person transfers has now firmly taken root in Kenya’s commercial sector, said Carol Kariuki, CEO of the Kenya Private Sector Alliance. As more traders join the digital economy, we’re creating a more resilient business ecosystem that benefits everyone—from the smallest vendor to the largest manufacturer. With mobile penetration continuing to grow and digital literacy improving nationwide, Kenya’s position as a global leader in mobile money appears set to strengthen further in the coming years.