Kenya’s e-commerce market could hit a new peak sooner than industry trends predicted throwing the country into the an elite tech league.

Experts predict a frenzy in the fintech funding space, in what they believe will propel the Kenyan e-Commerce market to outperform global average of 6 per cent, with the local market projected to register a yearly growth rate of 12 per cent between 2021 and 2025.

“Connectivity is crucial for efficient, affordable, and safe business processes. In fact, 10 per cent of all projects awarded between 2018 and 2020 focused on the digital transformation of the government, healthcare, and education sectors,” observes Oscar Mwai – the Chief executive of Ostatech Limited, whose predictions are supported by the rapid increase in Covid-19 – induced online purchases.

Accelarated growth?

Unsurprisingly, Kenyan e-commerce market has been growing significantly over the last few years, especially among small and medium enterprises, but accelerated from 2020 because of increased convenience and efforts to avoid physical interactions with hard cash.

Kenya’s biggest e-commerce market is mydawa.com. The store had a revenue of $9 million last year, followed by jumia.co.ke and phoneplacekenya.com as the second- and third largest stores with $4 million and $3 million, respectively. Altogether, the top three stores account for 1 per cent of online revenue in Kenya.

Global e-commerce market reached a value of $13 trillion last year with the market forecast to reach $55.6 trillion by 2027, while Kenya’s e-commerce market surpassed $1.7 billion, according to Statista, with World Bank Financial Inclusion Data noting that 72.9 per cent of Kenyans who use mobile money, accounting for 26.1 per cent of the population that make purchases and pay bills online.

As a result, notable changes in shopping habits emerged among consumers while at the same time, households opted for bulk-buying and stockpiling of essentials – which proved vital for online platforms.

Data by Statista Digital Market Outlook, predict that the compound annual growth rate for the next four years (CAGR 21-25) will be 12 per cent, compared to year-over-year growth of 44 per cent between 2020 and 2021. This in their valuation, suggests a moderately flooded market, which will give birth to a booming ecosystem of highly valued, cash-rich start-ups.