This is attributed to households and businesses increasingly turning to mobile platforms for quick access to cash.
The sharp increase came as the number of regulated lenders more than doubled, with CBK Bank Supervision Annual Report 2025 indicating that gross outstanding loans held by licensed Digital Credit Providers (DCPs) rose 99.6 per cent from Sh55.2 billion in December 2024, to Sh110.1 billion a year later.
Over the same period, the number of loan accounts increased 71 per cent from 3.9 million to 6.74 million.
The banking regulator licensed 110 DCPs during 2025, with 41 in June, 27 in September and 42 in December, taking the total from 85 at the end of 2024 to 195.
This was the fastest expansion of the regulated digital-credit market since CBK began licensing the previously largely unregulated industry in 2022.
The licensing regime became operational in March 2022 after amendments to the CBK Act and the Digital Credit Providers Regulations gave the regulator powers to license and supervise digital lenders.
The apex bank says the average loan size remained broadly unchanged in 2025, meaning the near-doubling of the loan book was largely associated with a much larger number of accounts and providers.
The average loan size was about Sh16,341 in December 2025, compared with Sh14,017 a year earlier.
The trend reflects the growing importance of mobile channels in everyday financial transactions.
The 2024 FinAccess Household Survey found mobile money was used by 23.2 million adults, making it by far the country’s most widely used financial service.
According to the survey, the use of microfinance institutions, including digital credit providers, rose from 1.7 per cent in 2021 to 8.8 per cent in 2024.
Another report by the Digital Financial Services Association of Kenya (DFSAK), a lobby group of digital creditors, points to the convenience of mobile applications and USSD platforms as a major feature of the expanding market.
The wider FinAccess evidence shows that Kenyans increasingly use credit for consumption and emergencies, rather than investment.
This points to the continuing tension between digital lending as a financial-inclusion tool and borrowing to meet immediate financial pressures.
The growth is expected to accelerate more in 2026.
By May, licensed DCPs had issued 8.4 million loans worth Sh150.56 billion, while the number of licensed providers subsequently reached 252.
The regulator says it has received more than 800 licence applications since March 2022, underscoring the scale of investor interest in the market.
The rapid expansion also explains the regulator’s increasing emphasis on consumer protection, transparent pricing, responsible lending and responsible use of customer data.