54
PodcastWorkAboutSubscribe
← All writing

28 September 2026 · 15 MIN READ

Are we screwed?

By Amschel Kariuki

Kenya has trillions in savings, but it flows to the government and people with title deeds, not to the young people it educated.

Africa
In this essay

If you’re young and Kenyan, you’ve probably heard this argument.

It goes like this: we’re educated but still broke. The colonizers left and a small group of Kenyans just took their seats. That group owns the land and the money. The government does everything, including stuff the private sector should be doing, and there’s no room left for anyone else. Conclusion: we’re screwed.

Thanks for reading Amschel Kariuki! Subscribe for free to receive new posts and support my work.

A few days ago I wrote Proximity to capital. My take there was a bit softer. Young people here struggle to get money not because we don’t have ideas or skills, but because nobody with money can see us. A stranger can’t tell if you’re good for it, so everything comes down to trust and who knows you.

This version is darker. I said the system is hard to read. This version says it’s rigged.

And honestly that difference matters a lot. If I’m right, you can build stuff that helps people get seen. If this version is right, none of that matters, because someone else owns the whole game and you’re just decorating their living room.

So I did the thing I always do when something bothers me. I stopped arguing and went to get the numbers.

Educated but broke

Yeah. This one’s true. And the numbers are kind of depressing.

Kibaki made primary school free in 2003. In one year, enrolment jumped from 5.9 million to 7.2 million. Free day secondary came in 2008. University went from about 240,000 students in 2012 to over 700,000 in 2025. Another 890,000 are in TVETs and colleges.

That’s genuinely a big deal. A whole generation went to school. Most of us reading this are that generation.

Now here’s what’s waiting on the other side. In 2025 the economy created 822,000 new jobs. 87% of them were informal. Only about 105,000 were formal, the kind with a payslip and an HR person. Meanwhile around a million young people start looking for work every single year.

So every year the country produces a huge wave of trained, hungry people, and the formal economy has room for roughly one in ten.

Everyone else goes informal. And to be clear, I’m not looking down on that. Most Kenyans make their living there, and a lot of it is real business making real money. But informal is also where you’re basically invisible. No payslip. No audited accounts. No credit history a bank takes seriously. It’s exactly where the trust problem I keep talking about hits hardest.

So, educated and broke. Check.

The industrialisation that didn’t happen

“Kenya will be industrialised by 2020” was actual government policy. Sessional Paper No. 2 of 1996 literally set the goal of Kenya being an industrialised country by 2020. Then Vision 2030 quietly pushed the deadline ten years and made the goal softer. Classic.

Then the Big Four agenda said manufacturing would be 15% of the economy by 2022.

Here’s what actually happened to manufacturing as a share of the economy (World Bank, KNBS):

  • 1990: 10.1%

  • 2007: 12.8% (our peak, apparently)

  • 2013: 10.9%

  • 2022, the year we were supposed to hit 15%: 7.7%

  • 2025: 7.1%

So we were supposed to double it and we halved it instead. Almost impressive.

Okay, fairness check. Kenya recalculated the size of its economy in 2014 and 2019, and that makes manufacturing look smaller on paper. So some of the drop is just accounting. But every source points the same way. We didn’t industrialise. We went backwards. Services are now about 55% of the economy.

Check number two.

The state as competition

This is the one I care about most, because I kind of said it myself last time. I mentioned Treasury bills paying over 15%, which makes it hard for anyone to justify lending to some random young founder.

Turns out I undersold it.

In March 2024, the 91-day Treasury bill paid 16.73%. Put yourself in a bank’s shoes for a second. The government is offering you almost 17%, in three months, with basically zero risk. Why on earth would you lend to a guy with a cold room in Kitengela?

You wouldn’t. And banks didn’t. Lending to businesses and households actually shrank: −1.4% in December 2024 and −2.9% in January 2025. The economy was growing, a million new people were job hunting, and the total money lent to the private sector went down. (CBK says part of it was the shilling getting stronger, which made dollar loans look smaller on paper. Fair. Still a collapse.)

By the end of 2025, almost 30% of everything Kenyan banks own was government debt. Sh2.5 trillion. Their government debt holdings grew 18% that year. Their loans to literally everyone else grew 6.6%.

Why does the government need that much? Mostly to pay off old debt. Public debt is around Sh13 trillion, about 68% of GDP. In 2024/25, debt payments ate about 69% of the government’s regular revenue. Almost seventy bob out of every hundred.

And then there’s pending bills, which nobody my age talks about but everyone who’s ever supplied the government has trauma from. When the government doesn’t pay its suppliers, those suppliers are private businesses, lots of them small. In March 2026, the national government owed suppliers Sh466 billion. Counties owe another Sh172 billion. So the government doesn’t just soak up the money that could’ve been lent to you. If you actually do business with it, it might sit on your money for years.

The government isn’t just a bad customer. It’s the competition.

To be fair, it’s gotten better. T-bills are back to about 9%. CBK cut its rate from 13% to 8.75%. Lending to the private sector is growing again, around 10% in mid-2026. The worst of it was roughly 2023 to early 2025.

But banks still charge businesses about 14.3% on average. That’s more than five points above what the government pays. I think of that gap as the stranger tax. It’s what you pay for being someone the bank doesn’t know.

Who owns what

This is the big one. The numbers mostly back it up, but it’s messier than the tweet version.

Money first. You’ve probably seen “8,300 Kenyans own more than everyone else” floating around. Africa Check looked into it and found it came from a company that doesn’t explain how it got the number, so I’m not using it. The better one is from Oxfam, November 2025: the richest 125 Kenyans have more wealth than 42.6 million other Kenyans. The top 1% own 78% of the country’s financial wealth.

A hundred and twenty-five people. That’s a wedding committee. That’s smaller than my high school year.

Now land, which is the one that actually matters if you want a loan.

How much of Kenya has a title deed? Depends how you count. By area, less than a third of the land is registered. By people, only 37% of landowners have a title deed. Everyone else has share certificates, sale agreements, allotment letters, or just “everyone knows this is ours.”

And the land that is titled is wildly uneven. A KHRC and Oxfam report from December 2025 found that 0.1% of landowners, with farms averaging 494 acres, control 39% of the land. Meanwhile 98% of land holdings are under three acres.

How did we get here? Part of the answer is in the Ndung’u Report from 2004, which was an official government inquiry. It found at least 200,000 illegal titles handed out between 1962 and 2002, mostly to officials, politicians and well-connected people. Most of what it recommended was never done.

Okay, here’s why this matters so much.

In Kenya, collateral basically means land. The World Bank found that banks here ask for collateral worth about 240% of the loan. So to borrow one million shillings, you need to walk in with two and a half million in property. If you had two and a half million in property, you probably wouldn’t need the loan.

A title deed is basically the most important document in the Kenyan economy. It’s how a bank that’s never met you decides you’re a real person.

Most people don’t have one. And a lot of the people who do got their land by being close to power when it was being handed out.

This is where the midnight argument and mine meet. I said the system is hard to read. The darker version says it’s rigged. With land, it’s both at the same time: the thing that makes you visible to a bank was handed out to people close to power. Being seen was something you inherited.

I sat with that one for a while.

The pension money

Last week in New York, during the UN General Assembly, Ruto asked a genuinely good question: “Why do African pension funds prefer US Treasuries over African power plants?”

Fair question. Kenyan pension funds hold about Sh3.2 trillion, around $24 billion. About 46% of that is lent to the government. The rules allow pension funds to put up to 10% into private companies and startups. What they actually put in is somewhere between 0.7% and 1.4%, depending on who’s counting. Infrastructure gets 0.02%. Zero point zero two.

Let’s do the maths. The gap between what pension funds are allowed to put into private companies and what they actually do is about 8.6% of Sh3.2 trillion. That’s roughly Sh270 billion, or about $2 billion. That’s twice what every single Kenyan startup raised in all of 2025. Combined.

That’s the money that could be building the cashew plants and the cold rooms. And it’s not foreign money we have to go beg for. It’s Kenyan money. It’s literally deducted from our payslips. It’s already here. It’s just mostly being lent back to the government.

Insurance companies are even more careful. Life insurers keep about three quarters of their investments in government debt.

So the idea is good. I mean that. It’s one of the best things a Kenyan president has said out loud in years.

But two problems.

First, he wasn’t really talking about people like us. When you actually read the speech, it’s about infrastructure: power plants, roads, the new National Infrastructure Fund. Big projects the government is already involved in. I couldn’t find him saying anything about pension money going to startups or small factories. I was hoping for that part. It wasn’t there.

Second, look at how past attempts to “unlock” money have gone:

  • Hustler Fund: the manifesto promised Sh50 billion a year for small businesses, including “venture capital, equity funds and long term debt for start-ups.” What actually happened was Sh90 billion in tiny loans to 28 million people, about Sh3,200 each. The Auditor-General found Sh13 billion unpaid for over a year, and the fund didn’t even have a lending policy. A KHRC study found no real effect on businesses or jobs.

  • Affordable housing: the target was 200,000 homes a year. About 8,800 have been finished so far.

  • KPC IPO: it was called a success, but according to one breakdown NSSF bought about 41% and other government-linked pension funds bought another 21%. Ordinary Kenyans bought 2.56%.

  • Safaricom stake sale: this was supposed to fund the infrastructure fund. Two weeks ago the High Court cancelled it because the public wasn’t consulted. The government is appealing.

Look at the Hustler Fund number again. Sh3,200 per loan. That’s the small end, the Mercy on Sunday end, the stuff Fuliza and M-Shwari already sort of handle. The middle, $50,000 to $500,000, the gap I said nobody fills, is exactly where the “venture capital and long-term debt” promise was supposed to land. It never showed up.

When the government says it’s going to “unlock” money, it usually means moving money to things the government picks. That’s still the same closed room. It’s just a bigger room with better lighting.

So, are we screwed?

Okay. Here’s where I landed.

The facts are mostly bleak. We’re educated and broke. We went backwards on industry. The government squeezed out lending to businesses, badly, for about two years. Money and land sit with very few people, and a lot of that came from being close to power.

But “screwed” means there’s nothing you can do. And the numbers don’t actually say that.

They say something more specific. Kenya isn’t short of money. Sh3.2 trillion in pensions. Sh1.5 trillion in insurance. Sh2.5 trillion of bank money lent to the government. It just all flows in one direction. It goes to the government, which banks always trust, and to people with title deeds, many of whom got them by being close to the government. Everyone else is a stranger, and strangers pay 14% or get nothing.

That’s not a broke country. It’s a country where money only trusts two kinds of people: the government, and people who already own land.

And weirdly, that makes me feel better than “we’re screwed,” because every piece of it can change:

  • If the government borrows less, banks have to lend to someone else. We literally watched this happen in 2025. T-bill rates dropped and lending to businesses came back.

  • If pension funds used even two or three points of that unused 10%, that’s more money than the whole Kenyan startup scene.

  • If the other 63% of landowners got title deeds, millions of people would suddenly have collateral a bank can actually check.

  • If lenders could judge people by something other than land (payment history, work other people can verify, someone credible willing to vouch for you and lose money if they’re wrong), banks wouldn’t need 240% collateral.

None of this is easy. Some of it needs a government that behaves differently, and unfortunately I am not a government. But none of it needs a revolution either. It’s plumbing. Boring, fixable plumbing.

In my last post I wrote about my friend and me hitting what felt like a wall. I said we were stuck, not failing. I think that’s true for the country too. We’re not screwed. We’re stuck. And we’re stuck in a way you can actually describe and measure, which is more than I could say two weeks ago.

So the honest answer to “are we screwed?” is probably: not yet. But the clock’s running. Every year another million of us come out of the schools Kibaki opened, and about nine in ten go straight into the informal economy, where nobody with money can see us.

That’s the real cost. Not just the money. The years.

Sources

Educated but broke

  • Primary enrolment rose from 5.9 million (2002) to 7.2 million (2003) after free primary education: Abuya et al., SAGE Open, 2015.

  • University enrolment of about 240,000 in 2012: Commission for University Education, via The Star, April 2025.

  • University enrolment over 700,000 in 2025, and 890,000 in TVET and other colleges: KNBS Economic Survey 2026.

  • 822,000 new jobs in 2025, 87% informal, about 105,000 formal: KNBS Economic Survey 2026.

  • Roughly a million new labour-market entrants a year: Serrari Group. The World Bank also says Kenya’s working-age population grows by about a million a year.

The industrialisation that didn’t happen

The state as competition

  • 91-day Treasury bill at 16.73% in March 2024: Kenyan Wallstreet.

  • Private-sector credit growth of −1.4% (Dec 2024) and −2.9% (Jan 2025): Central Bank of Kenya data, via Cytonn.

  • Government securities of Sh2.5 trillion (about 30% of bank assets), up 18% in 2025, against 6.6% loan growth: CBK Bank Supervision Annual Report 2025.

  • Public debt of about Sh13 trillion, around 68% of GDP: National Treasury data, via The Standard.

  • Debt service at about 69% of ordinary revenue in 2024/25: National Treasury, via Nairobi Business Monthly.

  • National government pending bills of Sh466 billion (March 2026): Controller of Budget, via The Star.

  • County pending bills of Sh172 billion: Controller of Budget, via Citizen Digital.

  • T-bill rates of about 9% today: Central Bank of Kenya, Treasury bills.

  • Central Bank Rate cut from 13% to 8.75%; private credit growth of about 10% in mid-2026; average lending rate of 14.3%: CBK Monetary Policy Committee, via The Star, August 2026.

Who owns what

  • Problems with the “8,300 Kenyans” figure: Africa Check.

  • The richest 125 Kenyans hold more than 42.6 million others; the top 1% hold 78% of financial wealth: Oxfam, November 2025.

  • Less than a third of land area registered; 37% of landowners hold a title deed: National Crime Research Centre report, via Kenyans.co.ke, October 2023. “The other 63%” in the conclusion is 100% minus that 37%.

  • 0.1% of landowners control 39% of land area; 98% of holdings are under three acres: KHRC and Oxfam, “Who Owns Kenya?”, via Nation, December 2025.

  • At least 200,000 illegal titles issued between 1962 and 2002: Commission of Inquiry into the Illegal/Irregular Allocation of Public Land (Ndung’u Report, 2004), via Nation.

  • Collateral worth about 240% of the loan: 2018 World Bank Enterprise Survey, as cited in the World Bank SAFER Project Appraisal Document.

The pension money

Thanks for reading Amschel Kariuki! Subscribe for free to receive new posts and support my work.

Read the original & join the discussion on Substack ↗

Discussion

Comments and likes here belong to this website and are separate from Substack. No account needed.

Loading discussion…

Keep reading

Not all money is the same

What should we be building in Africa?