Devise measures to free Kenyans from debt trap

The revelation that Kenyans are borrowing Sh1.4 billion daily from Safaricom’s Fuliza is shocking. Sadly, this is not about borrowing for investment to boost the economy. It is just about consumption and a growing desperation, where the majority of Kenyans are getting trapped in debt. The increased borrowing signals the financial pressures Kenyans are grappling with.

They have been borrowing Sh57 million hourly from Fuliza alone. Others go for other digital platforms that are backed by banks and other lenders that have been accused of charging exorbitant interest rates. The borrowing frenzy confirms that many are struggling to meet their basic needs.

A good number take the easy loans without caring about how they will repay them. It is not unusual to hear many low-income earners advising that they should not be sent any money on a particular mobile number for fear that it will be automatically be gobbled up by lenders.

What has been billed as a success story in the digital ecosystem has become an indicator of the increasing desperation of Kenyans. The convenience and flexibility is luring many into debts they cannot repay.

The global economic problems and Kenya’s national debt are now playing out at the individual level, with the high rate of unemployment and a struggling economy making people’s lives even more difficult. It simply boils down to the high cost of living afflicting a large number of otherwise hardworking Kenyans. Of course, there are those who are addicted to gambling, but they are a minority. They spend a tidy Sh169 billion a year, but the reality is that there are more losers than winners, with a number of young people also getting hooked.

As gambling thrives, there has been an increase in suicides, bankruptcy and domestic violence cases.

There is a need to craft viable policies and interventions to boost the economy and free Kenyans from this vicious clutch of debts.


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