state of Econony: Digital Credit Consumers Remains Bullish on Kenyan Economy
Digital credit consumers remain bullish on the Kenyan economy, with seventy-five percent (75%) of them reporting that they are optimistic about improving their financial situation within the next six months. This is according to Tala’s annual MoneyMarch report which saw the FinTech lender survey over 1,000 Kenyans to understand the impact of the cost of living and credit usage between January and March of 2024.
About two-thirds (64%) of those in full-time employment reported engaging in alternative income-generating ventures. This is symbolic of the rising cost of living experienced over the last year that has pushed full-time employed consumers to multiply their sources of income to survive inflation.
Another key finding was that Kenyans are likely to borrow more this year compared to 2023 and 2022 to cater for personal expenses rather than invest in business. This trend has resulted in fewer business owners and the year-on-year declining incidence of consumers with alternative income sources, now at 58% in 2024 from 80% in 2022.
“In the face of inflationary pressures, these findings indicate that Kenyans are standing resilient, leaning more into their entrepreneurial spirit and remaining hopeful for a better tomorrow,” said Annstella Mumbi, General Manager, Tala Kenya during the report’s launch event. “As Tala, we remain committed to our mission of supporting the Kenyan majority with innovative financial solutions as well as financial education that will empower our customers to seize growth opportunities and unleash their financial power, boosting our nation’s economy” concluded Mumbi.
On savings culture, 77% of consumers reported saving regularly or occasionally, a decrease compared to 87% in 2022 and 85% in 2023. However, 1 in 3 (30%) of them are saving more today compared to six months ago, with the main reason for saving being financial independence.
On financial literacy needs, Kenyans want more guidance on creating a budget to manage expenses owing to the increased expenditure for more than half (55%) of the respondents over the last six months. Other areas were guidance on starting/growing a business, saving effectively, and healthy borrowing (managing debt).
Tala organizes an annual financial literacy campaign every March named Tala MoneyMarch, which is now in its fourth year. The campaign aims to educate consumers on making better financial decisions, becoming financially responsible, and using digital credit providers products to improve their lives.
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