Kenya’s youth population, comprising approximately 22 million individuals under the age of 18, represents about 46% of the total population. The 2024 FinAccess household survey indicates that the financial choices and opportunities available to young women and men as they transition into adulthood are crucial in shaping the country’s economic landscape in the coming decades.
Gender Disparities in Financial Behaviours
As young women move into adulthood, their financial behaviours diverge significantly from those of their male counterparts. Despite a higher completion rate of secondary education among young women—33% compared to 20% for young men—both groups still experience a divide in financial access, highlighted by the survey findings. While education typically correlates with formal financial inclusion, young women face additional gendered challenges that impede their financial progress.
By the age of 21, young men are notably more likely to hold mobile money accounts, bank accounts, and access formal savings and credit options. In contrast, young women tend to rely on informal financial practices such as chamas (informal savings groups) and borrowing from friends and family. This raises questions about the underlying factors influencing these patterns.
Technology and Income
The survey reveals a clear correlation between access to technology and financial decision-making among young men and women. A greater proportion of young men own mobile phones, including smartphones, and utilize the internet compared to young women. This disparity is also reflected in income levels: the median income for young men at age 21 is Ksh 9,000, while for young women, it is Ksh 6,000. The income gap persists into the late twenties when men earn approximately double that of women.
The implications of early family responsibilities are also pronounced. By age 21, 49% of young women have children compared to only 11% of young men, significantly influencing their financial decisions. Informal finance mechanisms, deeply embedded in social structures, may better support young women in managing households and young families. While men often pursue material assets to facilitate their financial growth, women leverage social assets developed through community ties, enhancing their financial resilience.
Educational Trends and Future Opportunities
The evolving educational landscape presents a growing gender reversal in secondary school completion, creating new opportunities for young women. With 33% of young women having completed secondary school, compared to 20% of young men, it raises the question of how Kenya’s financial sector will adapt to meet the needs of this new generation of educated young women. There is potential for financial institutions to better harness the social networks that women cultivate to enhance their access to both formal and informal financial resources.
Youth Financial Inclusion Metrics
The analysis of the youth cohort from the FinAccess survey data for 2021 and 2024 highlights significant trends regarding gender disparities in financial inclusion, particularly among youth aged 16-23:
- Digital Connectivity: Digitization has transformed the financial landscape, with both male and female youth showing increased digital connection from 2021 to 2024. More youth now own smartphones and utilize the internet monthly, reflecting an overall population trend.
- Account Ownership Trends: The survey noted similar levels of formal account ownership between male and female youth cohorts until they reach ages 21-23. However, the percentage of males in this age group with formal financial accounts rose from 25% to 37% between 2021 and 2024. Conversely, the percentage of women using informal financial products decreased from 56% to 48%, indicating a decline in reliance on informal finance, although this has not been matched by an increase in formal financial product uptake among women.
- Diverging Savings Channels: As they age, young men and women increasingly diverge in their savings methodologies, with women favoring informal savings channels while men gravitate toward formal options.
- Loan Uptake: While the use of formal loans has grown among all youth age groups, informal loan uptake among women aged 21-23 has decreased significantly from 34% to 27% during the same period.
- Digital Payments Growth: There has been an overall increase in the frequency and extent of youth utilizing digital payment channels for household transactions from 2021 to 2024, consistent with broader population trends.
The financial journeys of young Kenyan women are intricately shaped by their educational achievements, income disparities, access to technology, and social responsibilities. As these women enter adulthood, their unique financial behaviours highlight the necessity for the financial sector to evolve to address their specific needs and leverage their potential. Moving forward, it will be crucial to develop targeted strategies that enhance formal financial inclusion and capitalize on the social networks that underpin young women’s financial resilience.
