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Total private sector credit grew only 0.44% year-on-year in April 2025, the slowest April growth since 2021. The CBK’s tight monetary stance, aimed at stabilizing inflation and the exchange rate, may have limited banks’ lending capacity or borrower appetite.
Credit to Kenya’s private sector showed signs of softening in early 2025, reversing last year’s growth trend.Data from the Central Bank of Kenya (CBK) shows that total credit advanced between January and April 2025 stood at KSh 15.32 trillion, down 0.88% from KSh 15.45 trillion in the same period last year. April 2025 alone recorded KSh 3.87 trillion in credit, a marginal 0.44% rise from KSh 3.85 trillion in April 2024.
While month-on-month growth was positive, it failed to offset weaker volumes posted in the first quarter. The average monthly credit issued in the first four months of 2025 was KSh 3.83 trillion, compared to KSh 3.86 trillion in 2024, the first early-year decline since 2022.
A deeper dive into April’s sectoral performance shows uneven momentum across industries. Credit to agriculture rose by KSh 16.7Bn, up 12.2% year-on-year. Trade and building and construction also recorded gains of KSh 35.6Bn (+5.5%) and KSh 8.3Bn (+5.8%) respectively. Credit to real estate grew 3.1% to reach KSh 458.6Bn, while consumer durables rose 18.8% to KSh 494.5Bn, the largest increase among all sectors.
Total private sector credit grew only 0.44% year-on-year in April 2025, the slowest April growth since 2021. The CBK’s tight monetary stance, aimed at stabilizing inflation and the exchange rate, may have limited banks’ lending capacity or borrower appetite.
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The strain in private sector credit is also mirrored in rising defaults. Kenya’s gross non-performing loan (NPL) ratio rose to 17.60% in June 2025, the highest level on record since 2015. The ratio has climbed steadily from 14.80% in December 2023, with each quarter in 2024 and 2025 marking new highs. The sharpest surge occurred in the first half of 2024, as borrowers struggled under tighter liquidity and elevated cost pressures.
