Following the paper trail through Kenya’s digital trade

Kenya’s traders can file documents electronically but still have to wait for manual approvals. At a Nairobi workshop convened by the EBRD with support from ICC Kenya and ICC Digital Standards Initiative, banks, regulators, and businesses examined why paper remains so difficult to dislodge.

About ten years ago, Alban J. Odhiambo of the Tony Blair Institute for Global Change and a few colleagues followed a flower from a farm in Kenya to the Netherlands to see how much of its life was lost before anyone could put it in a vase. As he told the audience at Nairobi’s Ole Sereni hotel on 6 October, “trade begins when that flower is cut, ready for export preparation, because that’s when that flower dies.”

From the moment the stem is cut, the flower has a finite life. Every customs check, missing signature, and document waiting for approval uses some of it up. By the time the roses reach a vase in Amsterdam, their journey has consumed part of what made them worth buying.

Cut flowers made up 62 per cent of Kenya’s horticultural exports in 2025, which were worth KSh143.78 billion (about US$1.1 billion), according to the Agriculture and Food Authority. The Netherlands is the largest market for Kenyan flowers, which are sold through the Aalsmeer auction or directly to supermarkets.

Kenya has invested heavily in digital trade, but exporters still encounter paper documents, manual approvals, and government systems that cannot communicate with one another.

The workshop, Advancing Digital Trade and Trade Finance in Kenya, was held to discuss how digitalisation could improve access to trade finance and strengthen Kenya’s position as a regional trade hub. It brought together ministries, regulators, banks, exporters, logistics firms, lawyers, and regional bodies, including the AfCFTA Secretariat and the Commonwealth Secretariat, with the aim of agreeing practical next steps.

The EBRD wants digital trade to unlock finance for Kenyan businesses

The workshop formed part of the EBRD’s growing engagement in Kenya. The bank is active in 41 economies, from Senegal to Mongolia and from Estonia to Kenya, and is opening a new chapter in sub-Saharan Africa. Its Trade Facilitation Programme (TFP) works through partner banks. It provides guarantees covering the payment risk on trade finance transactions, offers financing that banks lend on to their clients, and invests in training. Its Innovation Lab helps partner banks prepare for digitalisation and connects them with technology providers to test new solutions.

Anna Brod-Ohana, who leads the TFP’s business in Africa, said the question for banks is now how quickly the right conditions can be put in place, and whether digitalisation will translate into greater access to finance. “The objective is not simply paperless trade, it is finance-enabled trade,” she said, describing trusted trade data that supports supply chain finance, factoring, and receivables finance. With its digital payments, fintech sector, sophisticated banks, and position on East African trade corridors, Kenya was well placed to become a regional hub for SME-focused trade finance, she said.

Many SMEs across Africa have customers, purchase orders, and invoices but lack the working capital to grow, Brod-Ohana said, and she proposed measuring success by the number of SMEs financed, exports supported, and regional transactions completed. Lee Kinyanjui, Cabinet Secretary for Investments, Trade and Industry, welcomed the arrival of the TFP, including the funding it provides for on-lending through Kenyan banks.

Kenya’s digital foundations score well by regional standards

Pamela Mar, managing director of ICC Digital Standards Initiative (DSI), said Kenya scored 74 out of 100 on the UN’s Trade Digitalization Index, fourth among 45 countries in sub-Saharan Africa. Vashti Maharaj, digital trade policy adviser at the Commonwealth Secretariat, said Kenya hit 89 per cent for domestic paperless trade implementation.

Ndiritu Muriithi, chairman of the Kenya Revenue Authority (KRA), described a customs management system operating since 2018 and connected to the Kenya TradeNet Single Window. Kinyanjui said TradeNet connects more than 40 government agencies and saves businesses approximately KSh24 billion (about US$185 million) annually.

Stephen Lekupe, director of trade facilitation at KenTrade, recalled what came before the single window. An avocado farmer in Eldoret once had to travel to Nairobi, find out which permits were required and visit government offices to obtain them. An absent official could hold up the entire process.

Kenya’s cross-border record is weaker. Maharaj put its score for cross-border paperless trade at 67 per cent, with little progress since 2023. Participants in the day’s closing brainstorming session identified related problems inside government. Traders can submit documents electronically and still wait for manual approvals, while ministries and regulators continue to operate in separate compartments.

Michael Vrontamitis of T3i Partner Network moderated the trade finance discussion. Brendan du Preez, director of trade finance at Equity Bank, had visited the group’s trade operations centre before the event. “I’ve seen more paper there than I may have seen 10 years ago,” he said. Equity can extract data from documents and automate subsequent checks, but the paperwork keeps on coming.

Patrick Makau of Standard Chartered described “quasi-manual” processes in which the customer sees a digital interface while, somewhere behind it, “there’s a paper drop in the back end,” and the details are entered again. Banks can speed up their own processes, but they still depend on the documents produced by exporters, carriers, and government agencies.

Kenya’s law accepts e-signatures, but banks still want the paper bill of lading

Julius Opio, chairman of ICC Kenya, addressed the legal and regulatory problems in his opening remarks. Bills of lading, certificates of origin, letters of credit, and other trade documents have travelled on paper for decades, leaving businesses with boxes of files and lengthy administrative processes. “The private sector cannot go fully digital if the law and the institutions still require a wet signature,” he said.

Mar described the international momentum behind UNCITRAL’s Model Law on Electronic Transferable Records (MLETR), which provides a framework for recognising electronic equivalents of transferable paper documents. Countries aligned with the model law account for 42 per cent of global exports, she said, with another 23 per cent represented by governments that have publicly committed to alignment. (Legal alignment and public commitments do not necessarily translate into adoption, however. In an interview with TTP in September, Mar said that digital trade was still failing to scale and that the industry’s current approach was inadequate.)

The legal panel, chaired by Catherine Bridge Zoller of the EBRD’s Legal Transition Programme, examined what Kenya would need to change. The programme works with governments on improving the legal foundations for private sector investments, including access to finance, from factoring and warehouse receipts, to insolvency, and increasingly on digital trade. In Kenya, Bridge Zoller said, the bank is at an exploratory stage, assessing whether it can help Kenya move to recognising transferable documents (documents of title and negotiable instruments) in electronic form.

Daniel Ngumy, managing partner of ALN Kenya, said electronic signatures were already recognised under the Kenya Information and Communications Act, but section 83 of the Act still excludes negotiable instruments, such as promissory notes, from that recognition. Kenyan law also has no mechanism for “control”, the electronic equivalent of possessing a paper document of title, such as a bill of lading. In practice, he said, banks still want the physical bill. His priority was a law close to MLETR that settles who controls the authoritative record, how control passes between parties, and whose claim takes priority in an insolvency. (TTP noticed a similar gap while covering a workshop in Tunisia earlier this year. It is a common pattern: most countries have electronic signature laws but have yet to adopt MLETR.)

The UK, an important destination for Kenyan exports, has given qualifying electronic trade documents the same legal standing as paper since its Electronic Trade Documents Act came into force in September 2023.

Professor Sarah Green, who worked on the UK legislation, joined the panel remotely. She recalled reassuring commercial lawyers, insurers, and government officials that the proposed changes would preserve the certainty on which international trade depends.

Businesses, parliamentarians, and insurers wanted practical answers, she said. “They don’t care what the Bills of Exchange Act says. They just want to know, can I do this? Can I sign with an electronic signature? Can I use a digitised document?”

Kenya has already legislated for electronic transactions, records, and signatures, but Maharaj said its provisions for electronic transferable records were partial. Muriithi called for faster progress on legal frameworks aligned with MLETR and the AfCFTA Digital Trade Protocol.

The organisers said the discussion, together with a separate survey, demonstrated strong business support for legal reform to allow electronic transferable records, and for further digitalisation.

Kenya’s tax authority already holds the invoice data banks want

The most practical moment of the day came from the floor. Vrontamitis raised the need for an invoice registry to help banks verify transactions, assess SME credit applications, and avoid financing the same invoice twice. Du Preez agreed that duplicate financing was a concern.

Muriithi from the KRA stood up to explain that much of the information already existed. KRA’s electronic Tax Invoice Management System, eTIMS, records invoices issued by businesses, but taxpayer confidentiality prevents the authority from sharing that information freely with lenders.

“The registry exists, the data exists, but I’m not at liberty to share it with banks,” he said.

Businesses could, however, consent to sharing their records for credit assessment. Muriithi invited banks to explore a pilot and proposed working with ICC DSI and the EBRD on selected value chains.

“It’s not often that you get an offer from a government official in a meeting,” Vrontamitis said, and urged the bankers to take it up.

The proposal matters for smaller businesses that have customers, invoices, and orders but insufficient collateral or financial history to satisfy lenders. Verified transaction records could offer another way to assess their activity, although du Preez qualified the opportunity with a “yes and no”: lenders would still need confidence in the information’s quality and reliability.

Kenya’s digital records still meet paper borders

Odhiambo said a Kenyan exporter might use efficient domestic systems while an importing partner in Nigeria faces difficulties, because “everything is paper-based when it crosses the border.” (TTP heard the same concern when covering a similar event in Georgia earlier in the year, where different rules and document systems across the Middle Corridor made it harder for trade information to move between countries.)

ADAPT, the Africa Digital Access and Public Infrastructure for Trade initiative, aims to test whether one country’s digital records can be recognised and used in another. The AfCFTA Secretariat identified Kenya, Morocco, and Nigeria as initial implementation countries, and Odhiambo described plans for a Kenya-Nigeria regulatory sandbox expected to begin around February 2027 and run for approximately a year.

For shipping lines, the cost of moving paper is already measurable. Oliver Bunting of Maersk said the company’s electronic bill of lading pilots, including work in the region, had found that a conventional paper bill of lading takes an average of 12 days to move through the process.

That represents a potential saving of 12 days per container, he said, although achieving it depends on carriers, banks, customs authorities, and trading partners accepting the same electronic records. Maersk has committed to moving towards fully electronic bills of lading by 2030, but Bunting said adoption in Africa was still in single digits.

TradeMark Africa is working on the same problem through its Trade Logistics Information Pipeline (TLIP). TradeMark Africa’s Mark Priestley said the platform had been piloted in Kenya and work was under way to connect it with other countries. An agreement with India would initially support customs-to-customs information exchange.

Kinyanjui offered a comparison exporters would recognise. He said Kenya’s borders once had queues stretching up to 20 kilometres, whereas a motorist crossing from the Netherlands into Germany might notice little more than a change in road signs. Zsóka Kóczán, lead economist in the EBRD’s Office of the Chief Economist, said around a third of Kenya’s exports go to other African markets.

Small businesses will decide whether the reforms work

Kinyanjui described a young shoemaker he met in Nairobi who sells from home without a shop. He said digital trade should help businesses like his reach customers, receive payment, and sell beyond Kenya.

Talkmore Chidede of the AfCFTA Secretariat said around 90 per cent of African businesses are SMEs, most of them trading only at home, and that the Secretariat is training SMEs, women, young people, and people with disabilities to trade digitally. Maharaj said digitalisation could cut MSME trade costs by 15 to 45 per cent and give businesses without traditional collateral bankable records that show lenders they are going concerns. Many of those businesses, she said, are led by women.

One participant offered a personal example. After renewing a Kenyan driving licence digitally while abroad, the participant was stopped by police in Nairobi and told the electronic version was insufficient and that a physical licence was still required. The story prompted a wider question about how businesses outside major cities would manage digital trade when even mobile data could be expensive.

Participants called for common data standards, accessible interfaces, and open APIs that would let existing systems exchange information.

The workshop ended with a list of practical next steps

Discussions through the day pointed to a set of next steps: legal reform aligned with MLETR, so that electronic bills of lading and other transferable documents can be relied on; a consent-based pilot, proposed by Muriithi with the EBRD and ICC DSI, that would let businesses share verified invoice data with lenders; the Kenya-Nigeria ADAPT sandbox; pilots of electronic trade documents; and support to help SMEs take part. ICC Kenya, ICC DSI, and the EBRD committed to working with participants to turn the day’s discussion into practical initiatives. Brod-Ohana had said in her welcome that she hoped the event would be “a starting point for continued cooperation between banks, businesses, government and development partners”.

“The responsibility in making this happen belongs to all of us,” Opio said in his closing remarks.

The flower exporter needs shipments to travel from farm to buyer without checking, copying, and re-entering information at every handover. Kenya has digitised many of those steps, and the work agreed in Nairobi aims to connect them.

Prefer to listen? The full conversation is also available as a podcast below.