Kenyan Workers Earn More but Rely on Credit and Side Hustles

Workers in Kenya are reporting improved incomes and a more positive financial outlook. Recent data shows that financial satisfaction has reached 5.9 out of 10, recovering to levels seen in 2023 after a decline in 2024.

Around 70 percent of workers expect their financial situation to improve within the next six months, up from 63 percent a year earlier. This optimism reflects modest income growth, with about three in ten workers earning more than they did the previous year.

Income gains appear stronger among younger workers and higher income groups, suggesting uneven progress across the workforce.

Side Hustles and Multiple Income Streams Expand

Despite higher earnings, many workers continue to diversify their income sources. About 26 percent report having multiple income streams, while a quarter of those individuals say their side jobs generate more income than their primary employment.

Nearly half of respondents own or co own a business, highlighting the importance of self employment in Kenya’s economy. This trend indicates that workers increasingly rely on a mix of formal employment and entrepreneurial activity to maintain financial stability.

ALSO READ: How Artificial Intelligence Is Transforming Modern Warfare

The rise of side hustles reflects both opportunity and necessity, as workers seek additional income to meet growing living costs.

Increased Borrowing for Daily Expenses

While income levels are improving, borrowing remains widespread. Around 74 percent of workers reported taking out loans in the past year. Most loans were used to cover everyday expenses rather than invest in business growth.

Many individuals also rely on informal financial networks, including loans from friends, family members, and savings groups. These channels provide quick access to funds but can indicate underlying financial pressure.

ALSO READ: Adobe CEO Shantanu Narayen plans leadership transition as company expands AI strategy

At the same time, formal lending continues to grow. Bank financing for businesses has increased compared to the previous year, and mobile loans and microfinance services remain widely used.

Savings Habits Show Mixed Trends

Savings behavior in Kenya reflects a combination of formal and informal approaches. Bank based savings have increased significantly, reaching 51 percent compared to 32 percent in 2024.

Participation in informal savings groups has also grown to 53 percent. These groups remain popular due to their accessibility and community based structure.

Cash savings continue to play a role, as many individuals prefer immediate access to funds for daily needs.

Financial Stress Remains a Key Challenge

Despite improvements in income and sentiment, financial pressure remains high. Around 40 percent of workers report experiencing significant financial stress.

In addition, 54 percent say their debt levels have either remained the same or increased over the past year. Concerns about income security are widespread, with 71 percent identifying it as their top financial priority.

Nearly half of respondents also express concern about the risk of losing their job or primary source of income.

Alternative Income Strategies and Risks

Some workers are turning to alternative income strategies to manage financial challenges. About 23 percent report participating in betting activities over the past year, often driven by the need to supplement income.

This trend highlights both the growing search for additional earnings and the risks associated with uncertain income strategies.

A Fragmented but Expanding Financial Landscape

The findings show that Kenya’s workforce is adapting to changing economic conditions by combining multiple financial tools. Workers rely on a mix of income sources, credit options, and savings methods to manage their finances.

While access to financial services continues to expand, the system remains fragmented. Instead of relying on a single financial pathway, individuals balance formal banking, informal networks, and digital financial services.

Future Outlook

The Kenyan economy shows signs of resilience, with rising incomes and improved confidence among workers. However, continued reliance on credit and multiple income streams suggests that financial stability remains a challenge.

Going forward, sustainable growth will depend on improving income security, reducing dependency on short term borrowing, and strengthening financial inclusion across both formal and informal sectors.