Nairobi — Majority of Kenyans expect their household incomes to increase in 2023 despite the current economic headwinds, a new survey shows.
According to TransUnion's Q3 Consumer Pulse Study, eight in 10 (81 per cent) Kenyans expect their household incomes to increase in the coming year.
This is as 41 per cent of respondents to the survey said their incomes had increased in the previous three months.
Even so, nearly two in three (31 per cent) said their incomes had remained unchanged, while 28 per cent reported decreased household incomes.
"Salary reduction was the top reason consumers said their household income had changed in the month preceding the survey, followed by starting a new business," the survey stated.
Further, the study noted that nearly two in three (64 per cent) say they can pay their current bills and loans in full.
These positive signs came despite Kenya's annual inflation rate increasing to 9.6 per cent in October 2022, according to the Kenya National Bureau of Statistics.
The main drivers of inflationary pressure were increases in prices of commodities under food and non-alcoholic beverages, transport and housing, water, electricity, gas and other fuels between October 2021 and October 2022 .
According to Weihan Sun, Director of Research and Consulting at TransUnion Africa, the increased costs of necessities are likely to have an impact on consumer spend in the coming months.
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"It's likely that inflationary pressure was curbing discretionary spending among Kenya's households in the three months leading up to this survey, and we expect that this trend will continue. However, the fact that the majority of households are still able to service their bills and loan obligations is a sign of resilience, especially during uncertain macroeconomic conditions at a global level," said Sun.
Of all respondents, 48 per cent said they would make further cuts to their discretionary spending in the three months following the survey.
Nearly all consumers surveyed (98 per cent) considered access to credit and lending products important to achieve their financial goals.
Most consumers (60 per cent) surveyed plan to apply for new credit or refinance existing credit in the next year, led by Baby Boomers, where two-thirds (68 per cent) intend to do so within the next year, followed by Gen X at 63 per cent, Millennials at 60 per cent and Gen Z at 56 per cent.
