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Financial technology is expected to play a bigger role in economic growth for Kenya this year.
This is according to the latest Economic Insight report by the Institute of Chartered in England and Wales that projects that financial technology would have more impact on the economy than other traditional economic drivers such as agriculture which is likely to be affected by the delayed onset of the long rains season in Kenya.
Kenya has been at the forefront of this growth in the financial technology sector, with the value of mobile money transactions in the country now equivalent to 47 per cent of the Gross Domestic Product.
According to the latest Economic Insight report by the Institute of Chartered in England and Wales, highlights how the development and proliferation of new innovations in mobile technology have allowed Kenya to increase financial penetration beyond what would have traditionally been possible at this stage of the country’s development.
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The Regional Director for the Middle East, Africa and South Asia for Institute of Chartered in England and Wales Michael Armstrong, says: “Widespread mobile money usage has helped to smooth consumption, reduce poverty and boost economic growth in Kenya.”
As at September last year, there were 29.7 million mobile money subscribers, implying that over two-thirds of the population access and use mobile money transfer services.
He says the ICT sector now accounts for 5% of Kenya’s GDP and this is further reinforced by the presence of global tech firms Google, Microsoft, IBM and Samsung.
The report also indicates that most African countries have a positive economic outlook this year, largely due to the positive performance of traditional sectors.
The Institute of Chartered in England and Wales projects that the East African region would grow 6.3 per cent this year, West and Central Africa at 4.4 per cent and Southern Africa region at 1.5 per cent.
The report indicates that Ethiopia, Rwanda and Uganda are all expected to record a real GDP growth of 6 per cent supported by infrastructure investment and the expansion of financial services and telecoms services.
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