The Financial Inclusion Conference and Investor Expo (FINCON) 2024 provided a platform for insightful discussions on Kenya’s financial landscape. One of the key sessions on the first day focused on the Impact of Financial Inclusion in Kenya, moderated by Mr. David Cracknell. The session featured a thought-provoking presentation by Amrik Heyer (Senior Research Advisor FSD Kenya), followed by a high-level panel discussion on financial inclusion.
Amrik Heyer’s presentation shed light on the progress made in financial inclusion since 2006, the persistent barriers, and the role of financial services in Kenya’s economic growth. “Kenya has witnessed significant advancements in financial inclusion, largely driven by the expansion of digital finance, mobile banking, and internet accessibility. These innovations have brought financial services closer to underserved communities, unlocking economic opportunities and enhancing financial participation, she said.”
Despite progress, several challenges remain. Many Kenyans, especially those in rural areas, struggle with access to financial services due to digital illiteracy, lack of infrastructure, and regulatory constraints. Amrik emphasized the need for financial literacy programs to enhance access and ensure more inclusive financial participation.
The financial sector has contributed significantly to Kenya’s GDP by supporting Micro, Small, and Medium Enterprises (MSMEs) and individuals, particularly during economic downturns. The COVID-19 pandemic severely affected MSMEs, with incomes in this sector declining by 40% since 2019. The crisis underscored the need for broader financial solutions to support small businesses in times of economic uncertainty.
Many Kenyans use financial services primarily for daily expenses rather than investments. Encouraging investment culture is crucial to fostering economic stability and long-term financial growth.
Amrik highlighted the importance of collaboration among government entities, financial institutions, technology providers, NGOs, and community groups to ensure that financial services are accessible, affordable, and relevant for all.
Q&A Takeaways on Technology, Data, and Policy in Financial Inclusion
The interactive Q&A session provided valuable insights into financial inclusion strategies. David Cracknell underscored the importance of balancing digital innovation with traditional banking to prevent financial exclusion.
Amrik Heyer advocated for using data as a public good to drive financial innovation and create inclusive solutions tailored to diverse communities.
Michael Rono highlighted the Central Bank of Kenya’s efforts to incorporate public input in policy-making, ensuring financial regulations are fair and effective.
Angela addressed the often controversial topic of profitability versus inclusivity, emphasizing that financial institutions can be both profitable and inclusive by designing accessible and affordable financial products that serve diverse populations.
The discussions during this session underscored the progress Kenya has made in financial inclusion while acknowledging the challenges that persist. With continued collaboration, policy improvements, and digital innovation, Kenya is well-positioned to enhance financial inclusion and economic growth for all. The Association of Microfinance Institutions Kenya remains committed to driving these conversations and advocating for policies that support financial inclusion in the country.
