Report: Access to finances for Kenyan creatives is the biggest challenge

This is according to a Financial Sector Deepening Kenya (FSD Kenya) report titled New Business Models for Financing the Creative Sector Research. The report, which was released last week, is based on data collected from 33 creatives working in the music, performing arts, photography, design, visual art, crafts, fashion and film sectors.

According to the report, most musicians rely on personal savings and funding from family and friends to finance their enterprises. The rest work multiple jobs to record and market their music. “Some musicians quit music when income from royalties does not meet their needs,” FSD Kenya, an independent trust dedicated to an inclusive financial system to fight poverty in the country, says.

The report says creative enterprises in Kenya are primarily informal, with little incentive to register their operations. There are 275 375 creative enterprises in the country and of these 44 614 are registered, translating to a formalisation rate of about 16%.

Generally, creatives receive limited support from the government or relevant associations. Only 3% of respondents reported benefiting from government initiatives, and most are unaware of any government initiatives that drive growth within their professional sectors. FSD Kenya says the government needs to increase the budget for arts and culture through the Ministry of Sports, Culture and Heritage and push for the implementation of a local content quota.

Other challenges listed in the report include a lack of transparent linkage between the education system and the cultural industry, poor protection of intellectual property, lack of business and entrepreneurial skills, underdeveloped cultural infrastructure and institutions, and a lack of statistical data on the performance of the creative industry.

To improve the music sector, FSD Kenya says there’s a need for better formalisation of royalty management services, registration of enterprises, and business skills management for production houses and event organisers.

Potential financial solutions, says the organisation, are using targeted banking products, investment from banks in the arts, and partnerships with development partners. It adds that initiatives such as the Credit Guarantee Scheme need to be modified to target creative enterprises.

“We urge the leading banks in the country to follow the example of banks in other countries in creating banking products specifically suited to creative enterprises, as well as making sponsorship for the creative industries an important part of their marketing and social responsibility activities,” FSD Kenya said.

Read the New Business Models for Financing the Creative Sector Research here.