Nairobi — Despite Kenya's impressive strides in financial inclusion, a new report highlights a troubling gap: millions of adults hold accounts but remain disconnected from formal credit systems.
The Atlantic Council's "The Three Billion Person Challenge", co-authored with financial infrastructure company Tala, estimates that 3 billion adults worldwide are excluded from formal credit, representing a $10 trillion untapped economic opportunity.
In Kenya, this global issue is acutely visible. While 84 percent of adults have bank or mobile money accounts, only 16 percent are considered financially healthy.
Many Kenyans own accounts but avoid borrowing from formal institutions, reflecting not a lack of access, but a deep-seated distrust in financial service providers.
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By late 2024, surveys revealed that four in five Kenyans had experienced financial fraud or scams, driving many away from formal borrowing channels.
"The challenge we set out to solve a decade ago remains very real," said Ann Stella Mumbi, General Manager of Tala Kenya, during the report's Nairobi launch. "Access to credit has improved, but usage has not. Lack of trust in financial services providers is the critical barrier. This report reinforces our commitment to provide customers with choice, awareness, and control over their financial lives."
This discrepancy between account ownership and credit usage mirrors global trends. While low- and middle-income economies have achieved 75 percent account ownership, only 24 percent of adults actively borrow from formal institutions.
The barriers are consistent: affordability, mistrust, and a lack of products that meet consumer needs.
To address this gap, the report highlights the role of "Inclusion Turbochargers" like Artificial Intelligence (AI) and Digital Public Infrastructure (DPI). These tools allow alternative credit scoring and innovative lending models, enabling previously excluded populations to access credit without traditional collateral or credit histories.
In Kenya, Tala is already piloting these innovations. The company has served 13 million customers and disbursed $7 billion in credit over the past decade. Looking forward, Tala is advancing on-chain lending platforms and AI-driven risk models to unlock the economic potential of Kenya's "financially sidelined" population.
Building trust is not only about access--it's also about protection. Tala has launched the Global Debt Collection Dignity Initiative (DCDI), which seeks to set ethical standards for debt collection. Kennedy Osore, Head of Public Affairs at Tala Kenya, explained, "We are exploring ways to license or register debt collection firms, so that consumers know they are dealing with accountable, regulated providers. Co-creating these protections with government is key to restoring trust in the financial system."
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The findings underscore that financial inclusion is no longer just about opening accounts--it's about ensuring those accounts translate into meaningful, safe, and trusted access to credit.
Kenya has made remarkable progress, but to fully tap into the $10 trillion global opportunity, the focus must shift from access to usage.
As Mumbi notes, "The next frontier in financial inclusion is trust. Only when Kenyans feel confident that borrowing from formal institutions is safe, fair, and tailored to their needs, will we see the true economic potential of our population realized."
