The following is a feature by Innov8tiv.com‘s Milicent Atieno:
Small and Medium Enterprises (SMEs) have demonstrated their ability to transform the socio-economic setup of a nation by quantum leaps. This is mainly attributed to the fact that they require comparatively less capital and less managerial certification to start and manage; with reference to big companies. It is for these reasons that SMEs are mushrooming in every parts of East Africa.
According to the 2012 Economic Survey, and taking Kenya as a case study,Â Kenya is home to thousands of SMEs which in aggregate contribute to 20% of the country’s annual GDP. In the year 2011, SMEs in Kenya created 445,900 new jobs, which is about 85.7% of all the new jobs created in Kenya. It would be a rational conclusion to say that SMEs are formidable contributors to socio-economic development especially in developing countries.
However, there seems to be one challenge that is greatly compromising the effectiveness of SMEs. This is the shortage or complete lack of seed fund capital. Thus SMEs have to rely on donations, grants, and investment from other stakeholders. For SMEs lucky enough to get this funding, there is another challenge that soon crops up; accounting for the donations, investments, and grants.
Read more at Innov8tiv.com…