A severe spike in bad loans, which reached a worrying Ksh717.4 billion ($5.56 billion) in March 2025—the highest level in more than 20 years—has triggered a profound shift in Kenya’s credit risk management, forcing banks to rethink how they lend to the public.
After years of heavy reliance on traditional paperwork and property title deeds to approve loans, Kenyan bank managers are now shifting to smart artificial intelligence (AI) and alternative data to fix the problem.
