Kenyan banks and fintechs are increasingly tapping diaspora remittance data to unlock new lending opportunities, as record inflows from abroad highlight a large pool of income that has long sat outside the formal credit system.
- •Diaspora remittances climbed to a record US$ 5.04 billion in 2025, crossing the US$ 5 billion mark for the first time and reinforcing their role as one of Kenya’s most stable sources of foreign exchange.
- •Yet most of the money continues to flow into day-to-day consumption, with lenders largely unable to use the steady transfers to assess borrowers’ creditworthiness.
- •Singapore-based fintech Wapi Pay Pte Ltd, licensed by the Central Bank of Kenya as an international money transfer and foreign-exchange provider, has launched a Remittance Credit Scorecard aimed at helping banks and lenders treat remittance inflows as a measurable source of income.
“For decades, remittances have been visible in the economy but invisible in credit decisions,” said Eddie Ndichu, co-founder of Wapi Pay. “What’s shifting now is the ability to translate those flows into usable risk data.” The tool uses transaction history and behavioural patterns, analysed through artificial intelligence and machine learning, to build credit profiles for recipients of money sent from abroad. Wapi Pay says its system incorporates explicit customer consent, limited data sharing and encryption, reflecting growing scrutiny from regulators on how financial data is used.
The push comes as policymakers and lenders look for ways to convert Kenya’s growing remittance base into productive capital. While annual inflows are projected to approach US$ 7 billion in coming years, about 80% of the funds are still used for immediate consumption, limiting their impact on long-term investment and asset creation.
Banks see remittance-backed lending as a way to grow loan books while managing risk, particularly as traditional collateral-based lending faces pressure from weaker household incomes and elevated interest rates. Products under discussion across the industry include remittance-secured personal loans, diaspora-supported mortgages and construction finance.
The government has also sharpened its focus on the sector through its 2025–2030 Diaspora Investment Strategy, which aims to deepen formal remittance channels, reduce transfer costs and redirect part of the steady inflows into housing, infrastructure, manufacturing and other priority sectors.
Industry players say technology is key to that shift. By integrating remittance histories into underwriting systems, lenders can better distinguish between irregular transfers and stable, recurring inflows that resemble salary income. The challenge lies in data governance, consumer consent and regulatory clarity, particularly as more financial institutions seek to share and analyse cross-border transaction data.
