The rising cost of living is pushing more consumers to digital lending options, while savings habits are improving. But barriers to investment are still holding many back.
According to the latest MoneyMarch 2025 report by TALA, financial trends show growing reliance on digital loans, evolving savings habits and persistent challenges in digital investment adoption.
Digital Lending Growth
The report reveals 92% of Kenyans are now borrowing from digital lending platforms, up from previous years. Traditional banks (32%), family and friends (26%) and cooperatives (21%) are secondary lending sources. Most borrowers are using loans to cover business expenses, education costs and daily needs, as inflation and household expenses take a toll.
While digital loans offer quick access to cash, the report warns over-reliance can lead to deeper financial distress especially for those with multiple loans. Despite high confidence in debt management some consumers are unsure of their long term financial stability.
Rebound in Savings Amid Uncertainty
The report also shows a bounce back in savings habits after a decline in 2024. Many consumers are prioritizing savings for emergency funds, business capital and education. But high household expenses are limiting how much they can set aside for long term financial security.
“Consumers are prioritizing financial security but high living costs are restricting how much they can save,” the report notes. Savings are improving but not enough to build financial resilience.
Investment Challenges and Digital Trust Issues
Despite 57% of consumers using digital platforms for investment, challenges such as low income, fear of losing money and security concerns are holding back wider adoption. Many potential investors are hesitant due to trust issues with digital investment platforms. So we need more secure and transparent financial products.
But consumer optimism is high, with homeownership and entrepreneurship top financial goals for the next 5 years.
Call to Action: Financial Literacy and Security
Experts say financial literacy, digital security and user friendly investment solutions need to be improved to encourage more Kenyans to save and invest responsibly.At the report launch, Annstella Mumbi Tala-Kenya GM said; “Financial empowerment is not for the privileged few; it’s a right for all of us. Whether you are a student, entrepreneur, business owner or looking for a fresh start, this campaign is for you.”
Boniface Kamiti Consumer Protection Manager at Competition Authority of Kenya said; “Lenders should see themselves not just as lenders of credit but as partners in the financial wellness of their customers. Invest in financial literacy and borrowers will use credit responsibly and build their financial futures.”