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Wednesday, January 27, 2021

Entrepreneurial Boom: Kenyans Scramble to Register Businesses as Covid-19 Bites

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MARTIN SIELEhttp://www.businesstoday.co.ke
Martin Siele is the Content Lead at Business Today.

Business names registered between April and November 2020 rose 58.5 per cent to 65,782 compared to 41,490 in a similar period in 2019, data from the Registrar of Companies shows.

The growth represents the fastest jump in recent years. Registrations for new businesses have been traditionally confined to single digit growth; such as 3.1 per cent in 2019 and 8.9 per cent in 2018.

The record number of new business registrations can partly be explained by the shocks of the Covid-19 pandemic.

 10,551 new businesses were registered in July 2020, making it the busiest month of the past year at the Registrar of Companies.

With millions of Kenyans losing sources of income thanks to wide-spread lay-offs, redundancies, wage cuts and indefinite leaves, a large number turned to entrepreneurship.

Aerial view of a section of Westlands, Nairobi
View of a section of Westlands, Nairobi.

Many individuals registered companies with eyes on lucrative national and county government tender opportunities.

READ>>>>>IT Firms, Govt Offered Most New Jobs During Covid-19 – Report

Business registration and tax compliance certificates are among requirements for companies bidding for various government contracts.

Notably, there was a sharp increase in registration of single-owned businesses and small partnerships.

A large chunk of Kenyans explored entrepreneurship as the pandemic limited formal employment opportunities.

Data from the Kenya National Bureau of Statistics (KNBS) indicated that 1.72 million Kenyans lost their jobs in the three months to June 2020.

Between January and November 2020,  87,303 new business were registered representing 30,920 more than the same period in 2019.

The entrepreneurship trend is expected to carry on into 2021, although the test for new business owners remains ensuring longevity of their enterprises.

READ>>>>>Dim Prospects for Business in 2021 as Post-Pandemic Recovery Slows Down

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