NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Monday, March 23, 2015

Whichever way you look at it, Kenya and by extension the East African region is undergoing a major transformation as far as financial inclusion goes. In October last year, the Central Bank of Kenya released a report on development regarding the access and consumption of financial services in Kenya. The FinAccess 2013 Survey revealed that Kenya’s financial inclusion landscape has undergone considerable transformation.

Among the key highlights of the report is that the proportion of the adult population using various forms of formal financial services has risen steadily to 66.7 percent in 2013 from 41.3 percent in 2009.

From the above report, it shows that the recent reform efforts and innovations in the financial services sector is bearing ripe fruits with more customers, especially the under-served and the “unbankable” segments, now being seriously considered.

This means that financial institutions have to increasingly diversify their products portfolio with specific characteristics to attract a certain market segment including women, youth and children.

In Kenya, commercial banks dominate the financial services system with a majority of 43 banks licensed in the country situated in major cities and urban areas.

Even though women constitute 50.3 per cent of Kenyans according to the 2009 Kenya Population and Housing Census, majority of them are still locked out of the mainstream banking framework, by either choice or fate, due to the deep rooted socio-economic and cultural factors that for many decades have worked to their disadvantage.