A study by credit bureau TransUnion released on Wednesday says that this highlights the gap between expanding access to financial services and genuine financia Morris Maina, chief executive officer of TransUnion Kenya. Morris Maina, chief executive officer of TransUnion Kenya.
Kenyan households are increasingly turning to side hustles, cutting non-essential spending and reconsidering new borrowing as slower income growth and mounting financial obligations squeeze their budgets. A study by credit bureau TransUnion released on Wednesday says that this highlights the gap between expanding access to financial services and genuine financial security.
The report shows that only 30 per cent of Kenyan consumers reported an increase in income in the three months preceding the second quarter of 2026, down from 42 per cent a year earlier. The findings point to weakening household income momentum, even as consumers remain hopeful about their financial prospects.
The TransUnion Q2 2026 Consumer Pulse Study found that reduced salaries accounted for 27 per cent of reported income pressures, followed by job losses at 24 per cent and business closures or declining orders at 23 per cent. Although 78 per cent of respondents expected their income to rise over the next 12 months, optimism had declined by five percentage points year-on-year, with younger consumers particularly exposed to employment and income uncertainty.
The pressure is already visible in households' ability to meet their financial commitments. While 61 per cent of respondents said they could pay their bills and loan instalments, the proportion was unchanged from a year earlier. Among Generation Z consumers, however, 54 per cent said they could not meet all their financial obligations, a seven-percentage-point increase.
The findings suggest that while many Kenyans remain connected to formal financial services, their ability to withstand income disruptions and meet recurring expenses remains constrained. According to TransUnion, for households struggling to balance rent, food, transport, utilities, education and loan repayments, the problem is increasingly not just access to money but the reliability of income to sustain everyday expenses.
The strain is prompting consumers to seek alternative ways to stay afloat. Half of those unable to pay at least one bill or loan in full planned to make partial payments, while another half intended to take up gig work to supplement their earnings. The latter proportion rose to 54 per cent among Generation Z and 62 per cent among Generation X.
Another 28 per cent planned to draw on savings or borrow from friends and relatives, illustrating how households are combining informal financial support with additional work to bridge budget shortfalls. TransUnion Kenya chief executive Morris Maina said consumers were responding to slower income growth by diversifying their earnings, prioritising essential spending and making more deliberate borrowing decisions.
“Many households are diversifying income streams, prioritising essential spending and making more deliberate decisions about credit,” he said. The adjustment is also evident in spending intentions. More than half of respondents, or 53 per cent, planned to reduce discretionary expenditure on activities such as dining out, travel and entertainment.
Another 48 per cent intended to postpone major purchases, including appliances and vehicles, while 40 per cent expected to cut retail spending. At the same time, 41 per cent anticipated increasing expenditure on bills and loan repayments, suggesting that essential commitments are likely to absorb a greater share of household budgets and leave less room for consumption.