A study by Tala Kenya reveals that majority of consumers accessing digital loans via the platform use the funds to build their inventories in a bid to keep their businesses running.
An impact report by the digital lender indicate that borrowers who took business purposed loans used 78pc of the finances to buy inventory to sell at their shop compared to 15pc who used the platform to secure loans to buy farming suppliers.
“The report validates the transformational power of digital credit and demonstrates we are changing lives. The impact is real, measurable, and Tala remains deeply committed to building financial systems that work for everyone,” said Annstella Mumbi, General Manager of Tala Kenya.
9pc of respondents indicated that they access business loans on the platform to pay for wages, 5pc buy livestock while 5pc use the loans to purchase raw materials.
On the other hand, Tala Kenya says, three out of five borrowers use the platform to secure non-business loans such as emergency, education, household and health expenses.
“From saving businesses on the brink to ensuring children stay in school, Tala is helping Kenyans oil the wheels of the larger economy. This is what inclusive finance should look like,” added Mumbi.
The report shows that borrowers use 48pc of the digital loans on the platform to cater for emergency expenses compared to 41pc and 20pc for education for child or dependant, and managing household expenses respectively.
12pc of the respondents said they used the loans to fund personal or household events, 11pc on health expenses, 9pc on home improvement, 5pc on personal education and 1pc used the loan to pay other debts.
The report further indicates that 9 in 10 Kenyans reported improvement in their quality of life while 89pc of Tala borrowers feel more in control of their finances due to digital loans from Tala.
The impact performance report further shows that 90pc of borrowers worry less about their finances, and at least 80pc feel confident they can easily come up with Ksh 12,182 compared to 60pc national average.
Additionally, 60pc of women surveyed say using Tala has made them more confident in their financial decisions.
