Digital loans in Kenya have taken shape, with a growing number of consumers consolidating their loans with fewer lenders, according to the MoneyMarch 2025 report released by global fintech company Tala on Wednesday.
The report indicated a shift in borrowing habits, with 92% of Kenyans now favoring Non-Deposit Microfinance Institutions—commonly known as Digital Credit Providers (DCPs)—over traditional financial institutions.
The shift has significantly impacted loan demand from Commercial Banks and Microfinance Banks, which has dropped to 32%.
Tala’s General Manager, Annstella Mumbi, attributed the trend to the increasing availability of financial empowerment tools that enable Kenyans to build resilience amid economic challenges.
“Financial empowerment is not reserved for the privileged few; it is a right that belongs to all of us—whether you’re a student, an entrepreneur, a business owner, or someone seeking a fresh financial start,” Mumbi said during the report’s launch. “As we release these findings and kick off MoneyMarch 2025, we’re committed to supporting Kenyans on their journey to financial independence.”
Single-Lender Preference Gains Traction
The report, which explores how Kenyans earn, spend, save, borrow, and invest, reveals a growing preference for single-lender relationships.
Over half (52%) of borrowers now choose to stick with one lender—whether a licensed DCP or a bank—indicating a move toward simplicity and trust in financial dealings.
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Borrowing remains a critical lifeline for many, with slightly over a third of Kenyans increasing their loan uptake in 2025.
Rising living costs and delayed incomes are driving this trend, with business expenses, education, and daily needs cited as the top reasons for borrowing.
Encouragingly, 80% of borrowers expressed confidence in their ability to repay, signaling a cautious yet optimistic approach to credit.
Employment Shifts and Economic Pressures
The MoneyMarch 2025 report also shed light on evolving employment trends. Business ownership rose by seven percentage points this year, reflecting a growing entrepreneurial spirit. Meanwhile, full-time employment as a primary income source declined by 5% year-on-year.
The report notes that both full-time and part-time employees are less likely to pursue side hustles, as the high cost of living leaves little room for additional investments.
Despite these shifts, financial difficulties remain widespread. Nine in 10 Kenyans reported challenges over the past six months, with 32% experiencing significant financial stress.
Yet optimism persists—46% of respondents feel positive about their financial future, a testament to the resilience that defines Kenya’s economic fabric.
Investment Goals and Barriers
Kenyans are prioritizing business and home ownership as their top financial goals for the next five years.
The majority set aside 11–20% of their income for investments, channeling funds into savings accounts, SACCOs, and informal savings groups known as chamas. Wealth creation, business expansion, and retirement planning are the primary drivers of these investments.
However, hurdles remain. A fear of loss and distrust in investment platforms were cited as key barriers preventing Kenyans from saving and investing more, underscoring the need for greater financial education and reliable options.
The MoneyMarch 2025 shows DCPs leading the charge and consumers increasingly favoring streamlined borrowing, the financial sector is poised for further transformation—one that promises to democratize access to credit and empower a new generation of Kenyan wealth-builders.
