A new report by Tala has highlighted a shift in Kenya’s economic landscape, with business ownership rising while full-time employment declines.
According to the MoneyMarch 2025 Report, business ownership increased by 7 percentage points, while reliance on full-time employment as the main source of income dropped by 5 percentage points year-on-year.
The report indicates that fewer Kenyans are starting side businesses due to the rising cost of living, limiting their ability to invest in alternative income streams.
This economic strain is evident, with 9 in 10 respondents reporting financial difficulties over the past six months, and 32% expressing financial stress.
Despite this, 46% of respondents remain optimistic about their financial future, showcasing resilience in tough economic conditions.
Growing Reliance on Credit and Financial Inclusion
With the high cost of living and income delays, over one-third of Kenyans have increased their borrowing. Most borrow to cover business expenses, education, and daily living costs.
Encouragingly, about 80% of borrowers expressed confidence in their ability to repay loans. The report also found that 52% of Kenyans prefer to stick with one lender, whether a licensed Digital Credit Provider (DCP) or a bank.
Boniface Kamiti, Manager for Consumer Protection at the Competition Authority of Kenya, urged digital lenders to focus on customer education.
He emphasized the need for responsible borrowing and financial literacy, stating, “Digital lenders should see their role not just as providers of credit, but as partners in their customers’ financial well-being.”
Saving, Investing, and Future Aspirations
The report reveals that business and home ownership remain top financial goals for many Kenyans over the next five years.
Many respondents set aside 11–20% of their income for investments, primarily in savings, SACCOs, and chamas. However, concerns about loss and distrust in investment platforms continue to discourage some from saving and investing more.
Tala’s MoneyMarch campaign, now in its fifth year, aims to provide Kenyans with financial education, tools, and credit access to boost economic empowerment.
The report underscores the growing importance of entrepreneurship, financial literacy, and digital lending in Kenya’s evolving economic environment.
ALSO READ:Kenya advocates for enhanced substance control at 68th CND in Vienna
