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  According to FinAccess Household Survey 2024, financial access in Kenya improved from 83.7% in 2021 to 84.8% in 2024
  
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  MoneyMarch Report 2025 showed that more than a third of Kenyans increased borrowing, mainly from digital lenders
  
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  Speaking exclusively to farovint.co.ke, Tala Kenya General Manager Annstellah Mumbi explained that borrowers want quick and affordable products which digital credit providers (DCPs) are ready to offer
  

farovint.co.ke journalist Wycliffe Musalia has over six years of experience in financial, business, technology, and climate reporting, which offers deep insights into Kenyan and global economic trends.

Most Kenyans are borrowing from digital credit providers (DCPs) as opposed to commercial banks and SACCOs.

According to FinAccess Household Survey 2024, financial access in the country grew to 84.8% up from 83.7% in 2023, mainly driven by digital technology.

How many Kenyans are borrowing

The survey was supported by findings from Tala Kenya MoneyMarch Report 2025, which showed more than a third of Kenyans have increased borrowing.

This money goes mainly to business expenses – starting a new side hustle, education expenses (school fees) and daily expenses to manage the rising cost of living.

Digital Lenders Association of Kenya (DLAK) chair Kevin Mutiso revealed that the sector disburses KSh 500 million daily to Kenyans.

on Wednesday, March 12.

Where do Kenyans borrow money?

The MoneyMarch 2025 Report indicated that 92% of consumers borrow from DCPs, 32% from commercial banks, 26% from family and friends and 21% from SACCOs.

“Digital lending dominates borrowing, with consumers consolidating loans to fewer lenders,” read the report in part.

The rest of the borrowers borrow from unofficial or informal lenders (4%), the government (2%) and other lenders (2%).

Why many Kenyans borrow mobile loans

Quick and reduced daily costs

, Tala Kenya General Manager Annstellah Mumbi explained that DCPs ensure quick and affordable products with cheap daily costs to borrowers.

“We ensure that the customer understands the loan terms they are taking for transparency. Before we disburse, we give information on the entire cost of the loan.

“Ensuring lower interests depends on how products are designed. For instance, at Tala, our interest rates are between 0.3 to 0.6% per day… we work to reduce the cost as possible. This means if a customer took a loan for 30 days and repays on the 15th day, they only repay for the days they have used,” explained Mumbi.

Mumbi noted that the loan fee for the full month is, therefore, offset, giving it back as saving for the customer.

Interest on reducing balance

The GM noted that some digital lenders, including Tala, have incorporated loan charges on reducing balance, which gives customers the benefit of affordable repayment terms.

“We also calculate interest on reducing balance as a way of lowering the cost of credit for our customers. For instance, I customer with took a loan of KSh 20,000 and repays back KSh 10,000, the interest will only be charged on the balance,” she explained.

She challenged all DCPs, banks and other players to design products that lower the cost of borrowing.

“Ensuring the initial cost of credit is fair and affordable for the customer is the biggest responsibility of DCPs and other lenders. How they underwrite and who they decide to give credit to – checking for fraud, ability and willingness to repay- will guarantee responsible lending and borrowing,” Mumbi advised.

Kenyans prefer mobile banking

Meanwhile, more than half of Kenyans prefer mobile banking rather than traditional banking.

According to the Kenya Bankers Association (KBA) Banking Customer Satisfaction Survey released in February 2024, customers avoid high fees, poor customer service and inconvenient digital service from banks.

The survey noted that 46% of Kenyans ditch their banks due to increased service fees.