The recent court ruling allowing Diamond Trust Bank (DTB) to repossess 20 trucks over an outstanding Ksh 58 million debt highlights a growing financial dilemma in Kenya—borrowers struggling to repay loans and lenders aggressively reclaiming assets to cover defaults. This case is not just about trucks; it reflects the tough choices banks are making in an economy where loan defaults are rising, and auctions are becoming the new normal.
For years, businesses in Kenya and beyond have relied on tried-and-tested strategies—price wars, aggressive marketing, and customer loyalty programs—to stay ahead. But what happens when these formulas stop working? When consumers no longer respond to discounts, when competition becomes overwhelming, and when the economy throws unexpected curveballs?
The recent news that commercial banks in Kenya have achieved a record pre-tax profit of KES 262 billion raises questions about the relationship between bank profits and economic performance. This paradox seems counterintuitive given the challenges faced by the broader economy, including slow growth, high unemployment rates, and increased business closures.
The phenomenon of billionaires and established companies facing asset auctions despite apparent wealth can be attributed to a combination of financial strategies, behavioral biases, and systemic challenges.
Kenya’s financial landscape is shifting as the Central Bank of Kenya (CBK) moves to cut interest rates in an effort to boost lending. The goal? To unlock credit for businesses and individuals, stimulating economic growth. But here’s the real question: will banks ease access to credit, or will most Kenyans still be trapped borrowing from digital lenders at sky-high rates?
Kenya’s economic trajectory appears to be on an upward trend, with projected GDP growth rates around 5% for 2025, despite facing challenges such as increased unemployment, business closures, and rising auctions.
Moody’s has upgraded the country’s economic outlook and the growth is projected at 5% in 2025. The GOK attributes the positive growth to The Bottom Up Economic Agenda (BETA), which has redefined the country’s approach to inclusive growth and resilience.
