January 16th, 2025

Watch the graph below race. What did you notice? Go ahead and hit “replay” and watch it again as each financial service grows or shrinks or grows again culminating in overall formal inclusion at 84.8% – essentially flatlining since 2019.

Delving into the specific providers:

1. The most obvious impact on the top line is the meteoric growth of mobile money beginning at 27.9% in 2009 (2 years after launch) to 82.3% of adults in 2024.
2. The growth of banks to reaching over half of the population at 52.5% is also impressive but must take into account how this splits between traditional commercial banking which started decreasing in 2016 as mobile banking came onto the scene but saw an uptick between 2021 and 2024 to regain traditional bank outreach at 29% in 2024.
3. Mobile banking surpassed traditional banking in 2021 but actually saw a small decline to 32.6% in 2024. Fuliza has flatlined at 18.4% and the Government’s Hustler Fund jumped into the market with 28.9% of adults having taken a loan as of 2024.
4. Insurance which started at only 4.9% has more than quadrupled to 22% but that still means it benefits less than a quarter of the population and insurance has been on the decline since 2019.
5. Pensions started even lower at 3.2% in 2006 but have only managed to penetrate 11.8% of adults by 2024.
6. SACCOs remain a steady and highly valued financial service provider but only reaching 11.7% of the population.
7. MFIs have seen an uptick to 8.8% in 2024 with the entrance of fintech solutions like “buy now, pay later” helping people use finance to acquire goods and services.
8. Last, but certainly not least, is that orange line revealing that around a third of Kenyan adults continue to participate in informal groups, demonstrating the value placed on these mechanisms despite the growth in formal and digital financial services.

So, who will “win” this financial inclusion race? Frankly it is much less about which providers come and go and much more about how Kenyan adults “win” by accessing value-adding financial solutions that help them manage day to day, deal with risk and invest in their futures.  Stay tuned for more FinAccess Spotlights to dig deeper into the data.

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Due to changes in financial regulations and market classifications, the definition of MFIs (microfinance Institutions) has been expanded in 2024 to include digital lending platforms (digital loan apps) and hire purchase (buy now pay later) facilities. These changes are reflected in the trends for MFIs starting from 2024, prior digital apps and hire purchase were reported separately

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