Microsoft, M-Pesa partner to support MSME digital skills

Microsoft is partnering with M-Pesa Africa to supply digital skills development for African micro, small and medium enterprises (MSMEs).

Microsoft will support M-Pesa's Capability Development Academy through access to the Microsoft Community Platform and SME Skilling Programs to drive capacity building and digitization of small businesses across Kenya, Lesotho, Mozambique, the Democratic Republic of Congo (DRC) and Tanzania.

M-Pesa is Africa's leading fintech and payments service, connecting more than 60 million customers and more than 900,000 businesses through M-Pesa business solutions across eight countries, processing more than 91 million transactions and over $1 billion in value per day.

M-Pesa Africa MD Sitoyo Lopokoiyit said that MSMEs are the backbone of African economies and therefore empowering them to succeed creates an even larger impact for their communities due to their outsized economic contribution.

"We continue to pursue innovations and partnerships that connect customers and businesses across the continent to more opportunities while uplifting their livelihoods. We are excited to partner with Microsoft to upskill entrepreneurs and provide them with business tools that will enable them to run their businesses better and to grow their businesses," he added.

According to the World Bank, SMEs account for 40% of GDPs in emerging economies and generate at least 90% of new jobs.

However, research indicates that up to 80% of African SMEs fail within the first five years, despite having the highest entrepreneurship rate in the world.

Sitoyo Lopokoiyit, MD of M-Pesa Africa, believes that MSMEs are the backbone of African economies and that empowering them creates a larger impact for their communities. (Source: Safaricom)

Access to business enablement tools, capital and digital skills are some of the key potential stumbling blocks for SMEs, Microsoft and M-Pesa believe.

"Digitization can significantly enhance financial inclusion, most particularly for unserved and underserved enterprises such as MSMEs. Creating an enabling environment for these important economically active businesses that helps them thrive and participate actively in the continent's economies is essential for sustainable and inclusive economic growth," added Gerald Maithya, MD for Microsoft's Africa Transformation Office.

Closing the digital skills gap

Microsoft, through its Africa Transformation Office, is working to digitally enable 10 million SMEs in Africa through relevant business apps and ready-to-use skilling content.

Microsoft skilling programs available through M-Pesa business solutions aim to empower MSMEs to develop the knowledge needed to manage their finances more effectively, including building skills such as basic accounting, financial planning and cash-flow management.

"These skills improve their chances of accessing formal financial services such as bank accounts, financial loans and business insurance. In turn, adopting digital tools helps provide access to digital payment systems, which can help MSMEs save time and reduce the costs associated with manual transactions," Microsoft said in a statement.

The company said the skilling programs will also help MSMEs develop the entrepreneurial skills they need to start and grow a successful business.

"The goal of the program is to improve livelihoods for MSME entrepreneurs and their communities, and hopefully, open opportunities for these small businesses to compete in the global market. At the heart of the MSME upskilling program is the goal of reducing inequalities and empowering vulnerable groups, in line with the United Nations' Sustainable Development Goal 10," Microsoft added.

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*Top image is of Microsoft Tech for Social Impact (TSI) Vice President Justin Spelhaug and Safaricom Chief Financial Services Officer Esther Waititu at the partnership meeting at Dunhill Towers in Nairobi, Kenya. (Source: Safaricom)

— Paula Gilbert, Editor, Connecting Africa