Kenya’s informal sector represents an important part of the economy and plays a major role in employment creation, production and income generation. Covering mainly small-scale activities that are normaly semi-organized, unregulated and are not technology intensive, this sector is growing steadily: in 2019 alone, the number of persons estimated to have been engaged in the informal sector went up by 5.4% to 15.1 million.[1] Less high-profile than those working for large companies and in professional industries, we can think of these millions of Kenyans as real faces of the world of work.

The economic crisis brought on by COVID-19 is nowhere more visible than in the informal sector. Quarantines, social distancing measures, restrictions on of movement and closures of businesses occasioned by the pandemic have disproportionately affected those whose livelihoods depend on informal activities, particularly women[2]. Worryingly, this may exacerbate existing inequalities faced by those in the informal sector, who often lack the social protections afforded to those in formal jobs.[3]

Seeking to dig deeper into this, over the past 2 months the UNDP Accelerator Lab in Kenya has engaged with female small-scale traders selling fresh vegetables in Mukuru kwa Njenga (Mukuru), one of Nairobi’s largest informal settlements. We’ve been able to assess the impact of COVID-19 on their trade, learn about their routines and understand the wider context of their activities in order to shed light on the pressure points that policy and programmatic interventions may help to solve.

In Mukuru, we logged insights from 5 highly entrepreneurial and resilient women - Clementina, Concepta, Lillian, Phoebe and Rosemary - using 'capture cards'. This method allowed us to compare commonalities and differences in the women's experiences, and to have a full record of their testimonies. Whilst our conversations highlighted shared experiences between them, each trader faced her own challenges, illustrating the need to avoid ‘one-size-fits-all’ solutions.

Social insurance and protection

A lack of social protection was also a common area of concern. Concepta told us of her struggle to pay her husband’s medical bills while also taking care of the family: with no health insurance, an operation exhausted the family’s savings and she was forced to prioritize payment of the medical bills over higher education for her daughter. Social insurance targeted at those in the informal sector would provide a layer of protection and a new lease of freedom to Concepta and the millions of others who may lack the means to handle unexpected costs or an economic downturn, such as that the country currently faces.[4]

The women revealed that they had all worked hard to educate their children and said that seeing their children through secondary school was a proud achievement. However, they shared that their children were among the many unemployed youth in Kenya, and that their spouses were often also out of work. Being the sole consistent breadwinner in their families means that the women feel that they are left with little other choice than to continue working, come what may.

“My husband is a casual laborer. There is no steady supply of work, so he sometimes gets work and sometimes he doesn’t.” – Clementina

“Someone like me who is a breadwinner, if I close shop what will my children eat?” – Phoebe

Access to financing

Speaking to the traders about access to financial support was very insightful. The Government of Kenya has a number of programmes through which the women could potentially access credit: these include the Women Enterprise Fund (WEF) and the National Government Affirmative Action Fund (NGAAF). Borrowing from these facilities is significantly cheaper than private market loans, such as M-Shwari loans offered through the MPESA mobile payments platform, but the traders told us that they commonly used these rather than accessing funds through the WEF or NGAAF. Speaking to the women, we sensed either apathy or lack of awareness towards the Government funds.

“I only have vague details about the WEF... I have never had someone guide me on it.” – Clementina

“I don’t borrow loans from banks or the WEF. The only loans I have are from M-Shwari.” – Concepta

However, all of the women we talked to were either or have been members of a chama – a self-organized informal group for saving, lending and borrowing money – with some taking pride in being part of up to 2 chamas. While the women had leveraged on their social capital to get access to credit, they had not formally registered these groups. Whereas the apathy stems from the requirement for one to be in a registered self-help group of 10 members, loaning and saving seemingly works well in chamas.

“We are 18 members in the chama… Nowadays we save $1 per day because the members don’t make much. Before the pandemic, we used to save between $3 to $5 every day.” – Clementina

Infrastructure and public services

We observed a poor state of local infrastructure in Mukuru, which had also been worsened by the rainy season, leading to supply chain and access issues. Upgrading infrastructure such as roads and trading spaces would have a transformative effect, and installing streetlights to enable the women to operate safely at night would bolster the traders’ operations and hence the wider informal economy in Mukuru.

“My main challenge right now is many people have relocated. The road has also discouraged people from venturing these sides.” – Clementina

“The curfew has set me back economically, clients have dwindled and the goods that used to be supplied in plenty are no longer available.” – Rosemary

With no public waste collection and disposal services in Mukuru, a local solution has arisen through the cooperation economy: typically, the traders give farmers their waste produce for free or little cost as feed for their livestock. Whereas this appears an effective and organic at first, there was a consensus between the women that this could generate more money for them if organized in a structured manner.

“There is a man who comes for the waste to feed his goats. I give it to him for free instead of disposing the waste by the roadside.” – Lillian

“I think we can come to an understanding with the person who rears pigs or cattle to pay a certain amount of money for a certain amount of waste.” – Phoebe

Conclusion: a window to progress

Speaking to Clementina, Concepta, Lillian, Phoebe and Rosemary was an insightful experience and touched on a number of key themes related to the sustainable development philosophy of the UNDP Accelerator Lab in Kenya. Whereas we identified entry points for policy-level interventions, such as in bolstering social insurance and increasing uptake of financing, there were clearly also other areas where local solutions would benefit from incubation, such as the waste management relationship in Mukuru between traders and farmers.

We are thus looking forward to leverage on UNDP’s integrator role to connect health needs to social, economic and environmental well-being, doing so by working closely with the public and private sectors. As we support the national response to COVID-19, the issues highlighted by the women traders which affect their informal businesses present opportunities for catalytic  interventions which could deliver sustainable development and tangible progress.

Hearing the aspirations, goals and motivations of these entrepreneurial women offers a window to see what that progress may look like: they’re keen to expand to new locations and diversify their businesses to include cereal crops, hoping to invest in homes and educate their children further.

“The reason why I am still here despite the challenges is because of my persistence and resilience.” – Clementina

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Authored by Victor Apollo, Head of Solutions Mapping at UNDP Accelerator Lab in Kenya

[1] KNBS Economic Survey 2020

[2] UNDP Briefing Note: The Economic Impacts of Covid-19 and Gender Inequality Recommendations for Policymakers

[3] https://blogs.worldbank.org/voices/covid-19-will-hit-poor-hardest-heres-what-we-can-do-about-it

[4] https://www.ilo.org/africa/areas-of-work/social-protection/lang--en/index.htm