Kenyans access to unregulated digital loans applications has declined by 6.2 per cent across the last two years according to the 2021 Financial Access Household Survey published on Wednesday.

According to the survey co-authored by the Central Bank of Kenya (CBK), the Kenya National Bureau of Statistics and FSD Kenya financial access through formal non-prudential channels fell by 2.9 per cent to 35.7 per cent over the period.

This from the declined use of digital loan applications along with the declined uptake of the National Hospital Insurance Fund (NHIF), reduced uptake of pensions, investments, products from Micro-Finance Institutions (MFIs) and Sacco Societies.

“This could reflect there is more competition from regulated digital credit providers which tend to provide more stability. Kenyans have also cited some of the unfair debt collection practises that particularly characterise some of the more informal providers,” stated CBK Director of Research Prof. Robert Mudida.

The digital lenders are however now under the coverage of regulations following the recent assent to the 2021 Central Bank (Amendment) Act.

In contrast, the access of formal prudential financial services providers has grown by 3.9 per cent over the same period to 47.8 per cent primarily driven by overdraft facility Fuliza which represents a partnership between telco operator Safaricom and lenders NCBA & KCB.

According to data from Safaricom financial results covering six months to September 30, 2021, the Fuliza platform disbursed loans totalling to Ksh.242.6 billion in the period beating disbursements under KCB M-Pesa and M-Shwari.


Daily active Fuliza customers were estimated at 1.7 million people in the period while the average loan was sized at Ksh.375.80.

Overall, Kenyans formal access to financial services now stands ar 83.7 per cent from a lower 82.9 per cent from the previous survey in 2019, driven primarily by mobile money and mobile banking.

Mobile money daily and weekly usage has increased significantly in 2021 pointing to increased liquidity needs for households.

Nevertheless, the rate of financial exclusion has grown to 11.6 per cent from 11 per cent in 2019 driven largely by the effects of the COVID-19 pandemic on households’ livelihood, firms’ earnings and employment.

The exclusion rate has been more profound among female respondents and the rural population.

Similarly, youth aged 18-25 have registered a high exclusion rate, an outcome attributed mainly to the low acquisition of identification cards during the stay of the pandemic.

Nairobi City tops financial access by County ranking ahead of Nyeri and Murang’a.

Meanwhile, the counties of West Pokot and Turkana have the lowest rate of financial access while Garissa, Narok and Tana River have the highest rate of exclusion.

On the continent, Kenya has the third-highest rate of financial access among its population behind only the Seychelles and South Africa.


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