OPINION: For Kenyans to enjoy benefits of digital transformation, we must give them smartphones

Several recent technology-based developments in Kenya have highlighted a challenge related to a glaring digital divide.

One relatively current development is the registration of persons to the Social Health Authority (SHA).

The SHA registration process relies heavily on a USSD registration option to capture details from the masses, given that a majority of Kenyans do not own an internet-enabled smartphone in 2024.

While the numbers from several authorities indicate a relatively high adoption of smartphones, the reality on the ground is proving otherwise.

In this day and age, the lack of a smartphone, particularly for vulnerable communities who also don’t have access to personal computers, means having to pay a very high price to access the internet and, to an extent, most of the transformative e-government platforms.

I recently skimmed through the latest Communications Authority of Kenya Statistics Report.

The report indicates good progress and confirms that the country’s telecommunications subsector experienced significant growth during the 2023/24 Financial Year.

The report attributed the sector growth to telecom infrastructure expansion and increased smartphone service adoption.

The CA Fourth Quarter Sector Statistics Report for the Financial Year 2023/2024 (1st April—30th June 2024) indicates that at the end of the referenced period, the total number of mobile phone devices connected to mobile networks was 66.1 million, with a penetration rate of 128.3 per cent. The penetration rates for smartphones and feature phones were 68.3 and 59.9 per cent, respectively.

The CA Fourth Quarter Sector Statistics Report notes that feature phones acquisition dropped from 31,211,780 to 30,871,316 devices, while smartphone acquisition grew from 34,140,290 to 35,214,539 devices within the period under review.

However, as we say, mambo kwa ground, ni different, as the average smartphone device cost ranges between Ksh.45,000 and Ksh.80,000.

While some middle-class to affluent Kenyans have access to multiple devices, millions (more than 20 million) still suffer from numerous barriers that limit their capacity to acquire mobile phone devices. According to the GSM Association, these barriers include policy issues such as high device tax rates and a lack of device financing options.

The GSM Association, in a report titled Driving Digital Transformation of the Economy in Kenya, confirms that Kenya’s digital economy will contribute Ksh.662 billion to GDP by 2028.

The report projects that this growth, driven by strategic policy reforms, will accelerate digitalisation in critical sectors such as agriculture, manufacturing, transport, and trade. The report also forecasts the creation of 300,000 new jobs and increased tax revenues by Ksh.150 billion.

The report notes profoundly that “despite Kenya’s extensive mobile coverage, smartphone adoption remains a barrier for many due to high costs.

The report recommends policy measures such as tax reductions and expanding device financing options, which could help millions more Kenyans access mobile internet services by 2028. Improving smartphone access would help close the internet usage gap and increase active mobile money accounts, driving greater financial inclusion.”

The CA and GSM Association reports aptly capture the fundamental realities we continue to experience in the Kenyan and Tanzanian markets.

At Watu, one of our fastest-growing subsidiaries is our barely two-year-old Watu Simu business.

Watu Simu provides affordable and convenient quality smartphone financing options to allow our clients to tap into the economic and social benefits that such devices provide. We currently work closely with manufacturers like Samsung Mobile, to offer smartphones that serve our clients’ needs with fully loaded features.

Attesting to the growing demand for such financing options, Watu Simu celebrated its millionth customer in Kenya last month.

In one of our recent business reviews, diving into the data sets also provided us with a stark insight: More than 70% of our clients are involved in digital enterprises, including ride-hailing, online delivery and marketplaces, among other gigs that require smartphones for efficient operations.

I call it a stark insight as we now appreciate that we are enabling millions of Kenyans to contribute to nation-building by providing such device financing options.

Flipping the coin, if a majority of these Kenyans didn’t have access to the quality devices we finance, and there being limited device financing options, many of these people would perhaps be out of jobs and unable to meaningfully contribute to their personal and national economic aspirations.

As we continue to focus on several national development ideals, it is safe to say that we must prioritise smartphone penetration.

For all Kenyans to enjoy the benefits of digital transformation, we must work to put smartphones in their hands.

Placing smartphones in all Kenyans’ hands will have a positive ripple effect by deepening financial inclusion, enhancing social health access, facilitating education and related academic pursuits, and securing social relations.

Mr. Erick Massawe is the Kenya Country Manager at Watu.