Kenya Seeks to Expand Mortgage Access Using Mobile Money, SACCO Savings and Rental Records

Kenya is taking steps to broaden access to mortgage financing by allowing lenders to consider a wider range of indicators beyond traditional pay slips and income records. The country's Principal Secretary for Housing and Urban Development, Charles Hinga, announced that lenders could take into account mobile-money transactions, savings from cooperative credit unions, rental payment histories, utility bills, and business transactions when assessing borrowers' creditworthiness.

This move is part of an effort to include more Kenyans without formal employment or conventional income records in the housing finance market, as the government pushes forward with its affordable housing program. Hinga emphasized the importance of ensuring affordability and eventual ownership of homes, rather than merely focusing on the number of houses constructed.

The rapid growth in housing construction needs to be matched by an expansion of the market capable of purchasing these units. Traditional mortgage lending has typically favored borrowers with stable employment, regular salaries, and predictable incomes, leaving out many traders, small business owners, farmers, freelancers, and other self-employed Kenyans who may have sufficient income to repay a mortgage but lack proper documentation to prove their earnings.

To facilitate this, Hinga proposed that lenders develop more flexible assessment models reflecting the various ways Kenyans earn, save, and spend their money. Financial institutions have also expressed concerns about the rising costs of construction and the need for more affordable building materials and sustainable, climate-resilient infrastructure.

The government aims to integrate the Boma Yangu platform, which currently has over 1.29 million registered Kenyans, with financial institutions to create a comprehensive housing market that connects registration, prequalification, housing allocation, financing, acquisition, and title issuance.