In Kenya’s fast-paced digital economy, M-Pesa addiction is emerging as a silent threat to household stability. What started as a financial lifeline has, for many families, turned into a cycle of debt, secrecy, and emotional strain. As mobile loan apps continue to promise “quick fixes,” thousands of Kenyans are falling into an unseen trap—borrowing to survive, then borrowing more to repay.
The Rise of Digital Lending Culture in Kenya
M-Pesa’s convenience revolutionized the Kenyan financial ecosystem. However, its integration with third-party mobile loan platforms like Fuliza, Tala, Branch, and Okash has created an ecosystem of instant borrowing—one that’s hard to resist.
According to data from the Central Bank of Kenya (CBK), over 7 million Kenyans rely on mobile loans monthly, with Fuliza alone disbursing KSh 701.5 billion in 2023. Many of these users are low- to middle-income earners from Nairobi, Kisumu, Eldoret, and Machakos.
What’s more troubling is that nearly 1 in 3 borrowers take a second loan within 48 hours to repay the first—evidence of a growing cycle of digital debt.
The Hidden Toll of M-Pesa Addiction on Families
Emotional Strain in Marriages
Spouses are discovering that financial infidelity has gone digital. Partners take loans without informing each other, often lying about recurring deductions from shared M-Pesa accounts. This secrecy leads to arguments, mistrust, and in some cases—divorce.
“I only realized my husband had taken multiple mobile loans when we couldn’t buy food for our kids. Every time I sent him money through M-Pesa, it disappeared in seconds,” says Miriam, a mother of three from Thika.
Financial Erosion of Households
For families already living paycheck to paycheck, M-Pesa addiction creates a dangerous spiral:
- Small loans (KSh 500 – KSh 2,000) pile up
- Interest and daily penalties accumulate
- Automatic deductions leave households cashless even after receiving salaries or business income
Even boda boda riders and small traders in Gikomba and Kawangware report using over 30% of daily earnings to repay multiple loans accessed through M-Pesa.
Read Also: Can CBK Challenge M‑Pesa? Inside Kenya’s New Fast Payment System
Why Kenyans Are Hooked on Mobile Loans
Several factors are feeding this addiction:
- Speed & Accessibility: Loans approved in under 2 minutes, 24/7.
- No Paperwork: No collateral, no face-to-face meetings.
- Socioeconomic Pressure: Urban inflation, school fees, emergencies.
- Normalisation: Borrowing through M-Pesa has become so common, many see it as budgeting—rather than debt.
These apps use psychological hooks—such as instant approvals, gamified reminders, and loan limit upgrades—to keep users coming back.
From Borrowing to Breakdown: Real-Life Examples
In Nairobi’s Umoja estate, a man reportedly took his life in 2024 after defaulting on a KSh 15,000 loan. His wife revealed that loan sharks had begun sending humiliating messages to all his contacts, a tactic some unregulated lenders use to pressure repayment.
In Kisumu, a 22-year-old university student shared that he defaulted on one app and was blacklisted on all others. His CRB (Credit Reference Bureau) record now blocks him from formal employment and bank credit.
M-Pesa’s Role and Safaricom’s Response
While M-Pesa itself is not a loan service, it powers Fuliza (an overdraft facility) and enables integration with multiple fintech lenders. Safaricom has introduced user tools like:
- SMS alerts on Fuliza usage
- Loan limit caps
- Data consent requests for third-party apps
Still, critics argue that Safaricom and other telcos should do more to flag dangerous borrowing patterns or offer voluntary spending controls.
What Experts Are Saying
Financial experts and psychologists warn that M-Pesa addiction is not just economic—it’s behavioral.
“It mimics gambling addiction. The brain begins to associate borrowing with survival and reward,” explains Dr. Lydia Achieng, a clinical psychologist in Nairobi.
Economist David Ndii adds that without tighter regulation and public education, digital debt could become Kenya’s next social crisis.
What Can Be Done to Curb the Crisis?
1. Public Awareness Campaigns
Government and NGOs should launch digital literacy drives, warning about the risks of over-borrowing and how to identify predatory lenders.
2. Stronger Fintech Regulation
The CBK’s Digital Credit Providers regulations (2022) are a step forward but need stricter enforcement—especially regarding data privacy, interest caps, and ethical collection practices.
3. Financial Counseling
Workplaces and churches can introduce confidential financial therapy programs for families battling digital debt.
4. App Transparency
Loan apps must clearly show:
- Effective interest rates (APR)
- Penalties
- Credit reporting impact
Time to Rethink M-Pesa and Mobile Credit Culture
M-Pesa addiction in Kenya is no longer just a private issue—it’s a national conversation we must have. The convenience of instant loans has come at a cost, and that cost is being paid by broken families, stressed-out workers, and impoverished communities.
As we digitize our economy, we must also digitize our responsibility—with smarter borrowing, better regulations, and stronger emotional support systems.
Never Miss a Story: Join Our Newsletter
