There’s something quietly dangerous about how easy it is to borrow money in Kenya nowadays.
You can be standing at a boda boda stage with less than Sh50 in your M-Pesa, no payslip, no bank history; and in under 30 seconds, you’ve got Fuliza, Tala, Zenka, or some app with a smiling mascot offering you “emergency cash” at 20 per cent interest. Instant. Convenient. Painless.
That ease? It’s impressive. But is it also a trap?
We’ve built a credit culture where the barrier to entry is low, the urgency is high, and the consequences? Deeply, dangerously underestimated. But why? The narrative is noble: support small businesses, give liquidity to those SMEs banks have historically ignored, let the unbankable entrepreneur meet their bills and stay afloat. (The tenderpreneur? I think that one’s doing just fine.)
But is that what’s really happening in this sector? Or have we created a system where access to credit is being dangled in front of vulnerable customers, without clear warnings of what happens when repayments are missed, interest stacks up and the digital loan cycle becomes an expensive treadmill?
I once had the privilege of a one-on-one with a former governor of the Central Bank of the UAE during the launch of their Consumer Protection Standards.
And he didn’t mince his words. He said financial products should carry warning labels just like cigarette boxes. You know, big, bold, can’t-miss-it stuff like: “Credit cards can devastate you financially.”
Imagine if our short-term lenders had to do the same? Maybe something like: “Fuliza will fuliza you—be warned!” But let’s be honest… not likely.
Because that kind of transparency kills the vibe (and possibly the profits). But maybe it’s time we stop making credit look like a convenience store snack and start treating it with the caution it deserves.
Rise of digital debt hustle
Access to credit used to be something you earned. You built trust with a bank, you showed cash flow, you had a relationship manager who, at the very least, knew your second name.
But now? Your trustworthiness is boiled down to an algorithm and a SIM card. You’re no longer a person, you’re a phone number with borrowing potential.
Fintechs spotted this gap and ran with it. They’ve gamified borrowing, turning your repayment cycle into a scoreboard. Missed a payment? Here’s a daily penalty. Paid early? Here’s more debt. It’s not financial empowerment. It’s digital debt farming, big data they call it.
Fuliza: Gateway drug to bad financial habits
Fuliza: Safaricom’s overdraft service that lets you complete M-Pesa transactions even when you’re out of funds. Sounds helpful, right? Except that Fuliza isn’t just filling gaps, it’s creating dependency.
Let’s break it down: Fuliza is a loan disguised as convenience at a “small” fee. You buy milk, send fare, or buy airtime and Fuliza quietly nudges you into the red.
The catch? The fee isnt small in any shape or form, if you borrowed Sh20,000 from Fuliza and repaid it after 30 days, the effective annualised rate would be about 59.4 per cent.
And repayment is effective for the lender, the next time money lands in your M-Pesa, Fuliza grabs its share before you can even say hello. And if you had other plans for that money? Tough luck.
It’s a clever strategy. You’re not being forced to borrow, you’re being trained to. And millions of Kenyans are now caught in a loop where every transaction feels affordable… because the true cost is deferred (and growing). I have watched several banks join this gravy train of short-term lending.
Why 'access' isn't always empowerment
Yes, digital credit has helped people. It’s bridged gaps during emergencies. It’s enabled small traders to restock. But let’s not confuse availability with affordability. Just because you can borrow doesn’t mean you should.
The problem isn’t credit, it’s the culture we’ve built around it. We’ve made borrowing feel like success. We applaud the entrepreneur who’s juggling five loans, but we don’t talk about the stress, the default lists, or the emotional toll. We’ve turned loans into lifestyle tools.
Can’t afford the iPhone? Buy now, pay later. Short on rent? Dial a loan. Need a weekend out? It’s just Fuliza.
Eventually, we’re not borrowing for emergencies. We’re borrowing to maintain a lifestyle we haven’t yet earned.
So what's the forward?
We don’t need fewer credit products. We need better ones, paired with transparency, financial education and consumer protection.
Because the real danger isn’t in people accessing loans. It’s in them not fully understanding what they’re signing up for.
And this where consumer protection comes in
The job of a good compliance officer isn’t just to follow the rules, it’s to ask hard questions before products go to market. Are we matching products to the right consumers? Are we transparent about the cost of borrowing? Are we enabling financial growth, or simply monetising desperation?
Because when compliance is done right, it’s not about blocking innovation. It’s about ensuring innovation doesn’t quietly exploit the very people it promises to help. So yes, access to credit is good.
But it must be earned, explained and delivered with care. Otherwise, we’re not empowering anyone. We’re just giving them faster ways to fall into debt, and calling it progress.
