Kenya's microfinance bank (MFB) sector has experienced a severe decline over the past decade, marked by collapsing profitability and shrinking balance sheets. Industry data from 2014 to 2024 reveals sustained losses and a significant increase in bad loans, posing serious challenges for the 14 MFBs currently in operation.

• Total assets of MFBs fell to KSh 57.9 billion in 2024, a 9.8% decline from the previous year.
• Loans contracted by 20% over the decade, from KSh 39.2 billion in 2014 to KSh 31.2 billion in 2024, while gross non-performing loans (NPLs) surged fivefold to KSh 11.9 billion, pushing the NPL ratio above 35%.
• The Central Bank of Kenya (CBK) reported that three of the 14 MFBs, namely KWFT, Faulu, and SMEP, accounted for 88% of the sector's total losses in 2024, with profitability absent for nearly a decade.