Kenya's banking industry is experiencing a significant change in customer behavior, with tens of millions of deposit accounts disappearing from lenders' books in 2025. According to the Central Bank of Kenya's (CBK) Bank Supervision Annual Report 2025, the number of deposit account holders fell by 29.4%, from 114.24 million in 2024 to 80.68 million last year. This decline sharply reversed a decade-long expansion in bank accounts.
The decline in deposit accounts is attributed to various factors, including the consolidation of financial-inclusion fund savings balances into a single custody-administered account. This move aggregated customer wallet balances for reporting, reducing the need for multiple accounts. Additionally, increased recruitment of bank staff contributed to the change in the efficiency ratio. The CBK report also notes that the shift away from traditional bank accounts is driven by the increasing popularity of mobile money and other digital financial services.
The CBK analysis of the 2024 FinAccess survey found that only 14% of the population saved through banks or microfinance banks, compared with 36% who saved through mobile money. Mobile banking accounted for another 17%, with its popularity driven by convenience, accessibility, and trust. This suggests that Kenyans are using banks less as everyday savings wallets and more as part of a broader financial ecosystem involving mobile money, SACCOs, and other investment products.
The shift in savings habits comes against a difficult economic backdrop. Kenya's economy grew by 4.6% in 2025, down slightly from 4.7% in 2024, according to the Kenya National Bureau of Statistics. The softer growth came as households and businesses continued to grapple with high living and operating costs, limiting the amount of income available for conventional savings.
Despite the decline in deposit accounts, the value of deposits increased. Customer deposits in the banking sector rose by 11.6% to Sh6.12 trillion in December 2025, from Sh5.48 trillion a year earlier. Total net assets rose 10.3% to Sh8.35 trillion. The Kenya Deposit Insurance Corporation (KDIC) has linked the sharp reduction in accounts to the rationalization of dormant and inactive accounts.
The banking sector remains financially strong despite the changes in customer behavior. Pre-tax profit rose 17.7% to Sh306.3 billion in 2025 from Sh260.3 billion in 2024. Capital and reserves increased 18.6% to Sh1.4 trillion, while the average liquidity ratio improved to 59.3% from 56%. Lending also expanded, with gross loans increasing by 6.8%.
However, credit quality remains a concern. Non-performing loans stood at Sh696.9 billion at the end of 2025, only marginally below Sh697.3 billion in 2024, although the NPL ratio improved from 17.1% to 16%. The report highlights a continuing migration towards digital banking, with the number of ATMs falling by 61, or 2.66%, to 2,228 in 2025.
Key points
- The number of deposit accounts in Kenya fell by 29.4% in 2025, driven by a shift towards mobile money and other digital financial services.
- Customer deposits in the banking sector rose by 11.6% to Sh6.12 trillion in December 2025.
- The banking sector remains financially strong, with pre-tax profit rising 17.7% to Sh306.3 billion in 2025.
