Is saving a priority for many Kenyans?


According to Kenya’s Financial Diaries survey by Digital Divide Data and Bankable Frontier Associates, most poor households in Kenya rely on informal investment groups, popularly known as chamas to save and borrow money.

“What we saw is that people are saving quite a bit. The average household, the median household is saving about 40 days’ worth of work of their income which is substantial. Not huge amounts but that is big for them so at the median that was about 8,700 [Kenyan] shillings. So when we have really low incomes even when people are saving a lot of money in the context of the banking system,” Julie Zollman, principal investigator at Kenya Financial Diaries told CNBC Africa.

With Kenya’s overall cost of living rising, the report indicates that up to 78 per cent of the low income earners surveyed depend on chamas and savings in their houses to meet their financial needs. Chamas are societies which are normally used to pool and invest savings by people in Kenya.


These societies, which are on the rise in Kenya, have drawn the attention of commercial banks, deposit-taking microfinances and credit unions which in turn have developed tailor-made products to woo investment groups.

Technology has played a vital role in alleviating financial inclusion in the country. However, Zollman believes that if more is done to encourage savings by the financial sector, Kenya’s saving culture will improve rapidly.

“We need to improve those services. I think what is happening is that lots of people are trying out banks and do not really like what they see. Actually if you came from a low income background even in advance people have a very strong development ideology and they want even their savings to be doing right now not just sitting around,” Zollman said.