Home Community Insights Kenya’s Fintech Evolution Has Helped The Country To Achieve Significant Financial Inclusion

Kenya’s Fintech Evolution Has Helped The Country To Achieve Significant Financial Inclusion

Kenya’s Fintech Evolution Has Helped The Country To Achieve Significant Financial Inclusion

African countries, lately, have continued to emerge as hotbeds for Fintech innovations and investments. A report from the International Monetary Fund (IMF), called “Fintech in Sub-Saharan African countries”, highlights that sub-Saharan Africa has become the global leader in mobile money transfer services which has brought widespread access to financial services.

Some of these African countries are using inexpensive accessible tech to mobilize consumers in ways never seen before, as most of the fintech products developed in the region have significantly impacted the under-banked.

While Fintechs in Africa have been impressive with their innovations and offerings, this article spotlights Kenya’s fintech evolution, and how it has helped the country achieve significant financial inclusion.

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According to the 2021 FinAccess Household Survey by the Central Bank of Kenya (CBK), and the Kenya National Bureau of Statistics, formal financial inclusion expanded to 83.7 percent in 2021 from 82.9 percent in 2019 and 26.7% in the baseline survey in 2006.

The East African country has witnessed the emergence of various digital payment solutions beyond mobile money, which includes; mobile wallets, online payment gateways, and other digital payment platforms that facilitate cashless transactions both online and offline.

Also, Kenya’s capital Nairobi, has emerged as the leading fintech ecosystem city in Africa. According to the 2021 Global Fintech Rankings published on 8th July 2021, the vibrant city jumped 26 places to the 37th position globally beating both Lagos and Accra.

According to a report by Africa Fintech Summit, the value of the fintech market in Kenya was expected to surpass $4.9 billion by 2022.

The country’s fintech ecosystem has garnered international recognition and interest, which has seen many Kenyan fintech companies attract investments and partnerships from global investors and organizations seeking to support financial inclusion initiatives in Africa.

A Harvard Business Review article revealed that while financial inclusion in Kenya was at just 26% in 2006, today, 83% of the population has access to at least basic financial services.

During the first 11 months of last year, Kenyans made 1.9 trillion mobile money transactions worth more than $55 billion, and transactions in the first 11 months of 2021, were up 20 percent on the whole of 2020.

Notably, this article wouldn’t be complete without highlighting some of the major reasons why Kenya’s fintech sector is globally recognized.

The country has been able to leapfrog in terms of financial inclusion due to its positive regulatory environment and attractive macroeconomics.

The Central Bank of Kenya (CBK) and other regulatory bodies have been proactive in fostering a conducive environment for fintech innovation in the country.

They have introduced regulations and frameworks to ensure consumer protection, data privacy, and security while promoting healthy competition and growth in the fintech sector.

Wayne Hennessey-Barrett, CEO and founder of 4G Capital, a fintech mixing credit training with unsecured loans, stated that Kenya’s pro-business environment has allowed financial innovation to flow.

Along with the right enabling environment, financial products easily find a home in Kenya’s market due to a fast-growing middle class with a good level of financial literacy who can make easy payments through mobile money.

Also, Kenya’s efforts in the growth of FinTech can be seen through its forward-thinking financial inclusion strategies and incentivizing schemes such as the phased enactment of a dedicated payments and digital lending regulatory framework and the adoption of regulatory sandboxes.

The Launch of M-Pesa, a mobile money service launched by Safaricom in 2007, has also been pivotal in enabling financial inclusion to a large percentage of the Kenyan population, especially those in rural areas, where most of them just run transactions with a simple USSD code.

It is worth noting that the success of M-Pesa, has laid the foundation for Kenya to become a startup nation (aka Silicon Savannah), and Nairobi a leading Fintech city.

The mobile money service has also proven to be a valid payment option, and its transaction costs have contributed to its success in expanding access to banking services, which has benefited low-income people who may not have access to other banking options.

With M-Pesa, users can quickly transfer money, pay bills, and shop online, which has also helped in accessing banking services like savings and credit. The introduction of M-Pesa has greatly facilitated access to banking services in Kenya which saw the Communications Commission of Kenya report in September 2021, that there were 29.1 million M-Pesa customers in Kenya, making up 63% of the population.


FinTech is changing the nature of financial services globally, which has seen it become a key driver of economic development by speeding up financial inclusion and introducing innovative financial products at a rapid rate.

In Kenya, the quick acceptance of FinTechs, coupled with the mobile banking platforms already in place, has proven the possibility of opening up opportunities for Kenyans, giving them more credit and savings as well as transactional access options with these kinds of technologies.

While Kenya’s fintech evolution has continued to help the country achieve significant financial inclusion, an increased impact can be achieved by allowing greater innovation and attracting more investment into Fintech.

A supportive regulatory framework is key to attracting more players into the market, setting the stage for increased innovation in the sector.

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