Tala Money March Report has some interesting stats on the challenges millions of Kenyan consumers faced in the last 6 months.
According to the report, with about 7 in 10 (72%) of consumers claiming that their financial situation has not improved, this points to the conclusion that they are generally going through several financial challenges, the top of which is ‘cost of living expenses’.
More consumers state that their expenses are higher than their income, aligning with the decline in those with alternative sources of income. Increased incidences of income delays, lack of capital, loan burdens, job loss, and business closures in 2024.
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The challenges include:
- High cost of living
- Expenses higher than income
- High school fees
- Cash/income delay
- Emergencies (Hospital bills)
- Long for customers to pay for services
- Lack of capital
- Loans
- Lost jobs
- Losses from businesses
According to Tala, Generally, consumers are looking for avenues to reduce spending – higher YoY incidence of consumers claiming to spend less (24% vs. 18% in 2022). The top spend is on utility bills – higher than in 2023 (29% vs. 23%).
Consumers have cut down on personal expenses like clothing and travel/outings, which are considered a luxury. Despite the financial challenges experienced, consumers still have a saving culture similar to 2023.
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With this in mind, slightly over half (55%) of consumers have spent more in the last 6 months, and are coping mainly by cutting down on expenses and reducing spend on luxury items.
About a quarter (23%) are utilizing their savings to cope, implying consumers are generally saving. Sadly, some are skipping meals or selling off assets to make ends meet – a higher incidence of these occurrences in 2024.
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