Microfinance banks in Kenya have consistently posted losses since 2016, reaching KSh -3.5B in 2024

  • Microfinance banks in Kenya recorded their last profit in 2015 (KSh 0.6B) before sliding into losses.
  • The sector’s losses deepened from KSh -0.4B in 2016 to KSh -3.5B in 2024.
  • The steepest single-year decline occurred in 2020, when losses increased by 560.8% to KSh -2.2B.
  • Even in recovery years like 2019 (KSh -0.3B) and 2021 (KSh -0.7B), the sector remained in losses.
  • Over the 10 years, profitability fell at a -212.1% CAGR, reflecting a structural collapse.
  • Since 2016, there has been no single year of profit, highlighting sustained weakness.
  • The worsening losses mirror other sector struggles, such as stagnant deposits, weak asset growth, and rising NPLs.

Kenya’s microfinance banks are battling deep financial distress, having posted consistent losses since 2016. From a profit of KSh 1.0B in 2014, the sector slipped into negative territory, and by 2024, losses had ballooned to KSh 3.5B. This represents a staggering -212.1% CAGR over the past decade, signalling that profitability has not just declined but collapsed. For institutions designed to provide financial access to underserved populations, this trend paints a worrying picture regarding sustainability.

Source:

Central Bank of Kenya (CBK

Period:

2014–2024
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