According to a new study, more than half of the population in Kenya is dependent on debt to satisfy their daily financial commitments.
According to a Consumer Insight survey, the percentage of Kenyans who borrow from digital lenders has increased from 40% in 2019 to 52% in 2023.
“This trend of economic worry is manifested in family members actively working and earning incomes (up 10 per cent from 2018) and on reliance on debt, leading to borrowing as a way of life,” says the research dubbedWakenya.
The study, which surveyed over 3,000 Kenyans in 16 counties over four waves between 2016 and 2023, also found that millions of Kenyans are changing their values by migrating to new mindsets and ways of life, with social migration behaviour having a profound effect on leadership and lifestyles to employment, education, and entertainment.
59% of Kenyans borrow using their mobile phones, a significant increase from 33% in 2016.
Consumers’ lending sources have also evolved, with digital lenders replacing bank branches.
An earlier government poll found that more than 80% of Kenya’s adult population uses mobile money providers, indicating a boom in digital financial services due to the growth of digital lenders and loans following the introduction of M-Shwari in 2012.
M-Shwari enables M-PESA consumers to save and borrow money. Prior to this change, Kenyans relied on family, friends, banks, and Saccos for loans.
According to the study, at least six trends are transforming Kenya, including the digitization of work, home, and education, increased health awareness, cultural upheavals, a new media landscape, and acceptance of illegal drugs, particularly cannabis.
