Why Kenyans are no longer saving in banks

By JULIE OWINO, NAIROBI, Kenya, Aug 20 – Lack of cash to save and the shortage of normal profits are the main reasons why the percentage of Kenyans saving in banks is declining.

According to the Financial Sector Deepening (FSD) survey, 35 percent of Kenyans do not store in banks due to loss of finances, even as 15.5 percent of people lack the ordinary means to have interaction in saving.

“Of the twenty-two (22) reasons surveyed for non-use of a bank account, eight (eight) reasons emerged top with a complete response rate of 88 percent. Lack of money to save, lack of ability to keep an account, and lack of ordinary profits had been the top 3 reasons referred to, in general, accounting for 70 percent of reaction fee,” according to the survey.

Other reasons include the long distance to the nearest bank, lack of trust, and financial literacy obstacles, although now not as tremendous.

This is at the same time as mobile banking account utilization increased by eight percent in 2019. The usage of conventional bank money owed declined by an average of 2.1 percent throughout the same period.

The rapid adoption of mobile banking money owed usage turned into more common among the male/city customers at an eight percent growth rate, even though many of the lady/city mobile banking accounts utilization increased by only 1 percent factor under, at a 7 percent growth rate.

This may also reflect the closure of financial institution branches with the aid of some banks and the rapid uptake of technological solutions by young people.

“There are two foremost demanding situations clients stated within the use of a financial institution account, which include Automated Teller Machine (ATM) or card device not working and being levied with sudden fees,” reads the survey.

The ATM/ card device no longer working changed into more reported in the city areas and a few of the girl customers whilst the unexpected fees had been extra stated with the aid of male and rural customers.

The file comes against the backdrop of expanded conventional money owed declined from 31.7 percent in 2016 to 29.6 percent in 2019, cell banking debts usage accelerated to twenty-five.3 percent in 2019 from 17.Five percent in 2016.

It similarly indicates that Growth in mobile banking account usage is specifically driven by younger people under 35 years.