Regulatory framework of micro and small enterprises in the informal sector in Kenya: a critical analysis
Kamuti, Rosario Muthoni
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The enactment of the Micro and Small Enterprises Act in 2012 in Kenya was a major step forward in the regulation of Micro and Small Enterprises, and especially those in the informal sector. The Act provides for registration procedures, account keeping requirements and it establishes the MSE Authority and the MSE tribunal. Regrettably, the implementation of this Act has however been poor. Although the Act established the MSE Authority which has the mandate of formulating policies for MSEs, there has been no policy formulation to date. There has also been no evidence of the use of the tribunal. Therefore, the Objective of this study is to analyze the regulatory framework of MSEs and find out the loopholes and the challenges faced so as to formulate recommendations that would strengthen the capacity and role of the Kenyan government in enhancing performance, access to resources and economic efficiency in the MSE industry in the informal sector. Major recommendations drawn in this study include making the registration process cheaper and accessible through online portals, and development of incubation hubs for micro and small enterprises to make it easier for entrepreneurs to access resources.