The amount of bank loans that Kenyans have defaulted has now hit Sh724 billion. In another sign of an economy that is struggling, the volume of non performing loans among commercial banks in the country increased by Sh7 billion as at April 2025 from Sh717 billion to Sh724.2 billion.
These figures have been released by the Central Bank of Kenya (CBK) in its latest Monetary Policy Committee report.
“The ratio of gross non performing loans stood at 17.6 percent in April 2025 compared to 17.2 percent in February 2025. Increases in non performing loans were noted in trade, personal and household, tourism and hotels, and building and construction,” the CBK said in its report.
“The increase in non performing loans in the reviewed period was mainly due to a challenging business and operating environment.”
As at April 2025, the total loans that banks issued reduced by Sh7.5 billion to stand at Sh4.11 trillion.
When contrasted to one year ago, the defaulted loans have grown rapidly by close to Sh100 billion. According to the data from the Central Bank, as at April 2024, the amount loans Kenyans had defaulted stood at Sh630 billion. At the time, this amount of loans in default was the highest in close to 20 years and was attributed to high interest rates.
the amount of defaulted loans has been rising steadily over the past few years. For example, towards the end of year 2020, Kenyans had defaulted on bank loans worth over Sh404 billion.
At that time, non performing loans (NPLs) increases were noted in the transport and communication, energy and water, tourism, restaurants and hotels and real estate sectors, mainly due to disruptions of the businesses.
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By mid-2022, the amount of bank loans defaulted by Kenyans crossed the half a trillion shillings for the first time in history. The amount of defaulted loans jumped by Sh30.6 billion to hit Sh514.4 billion in the month of June 2022.
