Digital Credit and Financial Performance of Small and Medium Enterprises in Nairobi City County, Kenya
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Date
2025-09
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Stratford Peer Reviewed Journals and Book Publishing
Abstract
This study ascertained the effect of digital credit on financial performance of selected SMEs in the
CBD of Nairobi City County, Kenya. The research employed a cross-sectional research design. The
population comprised 5,400 SMEs located in the Nairobi CBD. The study utilized a stratified random
sampling technique to determine the necessary sample size. The sample involved responders selected
by stratified proportionate sampling to identify 358 significant SMEs across several categories by the
Licensing Office in Nairobi City County Offices. The research utilized source data gathered via a
research tool. A pre-testing questionnaire was administered to 18 owners/managers of SMEs not
included in the study sample. All the others in SMEs in Nairobi, not included in the study population,
made up this population. Cronbach’s alpha tested the reliability of the scale and a score of 0.7 was
considered. SPSS Package for Social Sciences was used. All the data gathered was of the quantitative
type and it was analyzed through inferential analysis and descriptive analysis. It was shown as figures
and tables. It was found that digital credit, its easy access, the rules surrounding it and its terms are
key to how SMEs in Nairobi City County, Kenya, manage their finances. The research showed that
SMEs in Kenya benefit financially from being able to access digital credit. Digital credit does not have
a major impact on SME finances. It is concluded that the rules for digital credit play, a vital role in the
financial health of SMEs. SMEs depend on privacy regulation, identity theft regulation and interest
rate regulation that deal with the issues and appropriate responses. From this study, it is advised that
SMEs take advantage of digital credit to help them reach their main aims and carefully plan how to
achieve their objectives. Those who provide digital credit should make products available to SMEs to
assist in shaping their offerings, sell them and urge use of the products by other players in the market.
It is necessary to make sure the quality of the credit service is perfect, as this can keep customers from
comparing prices with others. The report advises that digital credit providers for SMEs in Nairobi
should come up with strategies to increase their online visibility
Description
Research Article
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Citation
Thomas, J. N., & Mwenda, N. (2025). Digital Credit and Financial Performance of Small and Medium Enterprises in Nairobi City County, Kenya. Journal of Finance and Accounting, 9 (4), 38-63. https://doi.org/10.53819/81018102t5385