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Central Bank data reveals counties with highest banking clients and those with the poorest

In a study that is bound to not only spark controversy, but also likely to result in ethnic stereotypes, and revive debate about the regional imbalance that the country might have, the Central Bank of Kenya has released data that shows the country’s banking distribution. It shows which counties and regions have the highest number of banking clients, and which ones have the lowest.

In a tabulation that further proves the skewed distribution of financial institutions and facilities, it was found that while certain counties registered high on the banking scale, others had extremely low levels of clients who are formally engaged with banking or credit financial facilities.

More than half of Kenya’s bank branches are found in Nairobi, Mombasa and Kiambu, reflecting wealth and income inequality across Kenya’s 47 counties.
Central Bank of Kenya (CBK) data shows that the three counties have 794 branches or 53 percent Kenya’s 1,502 banking outlets.

Nairobi accounted for 39.5 percent of Kenya’s bank branches, reflecting the capital city’s economic dominance over the other 46 devolved units created in 2013 to address the wealth imbalance.

Bank CEOs say the spread of banks is informed by cash flow and economic activity in the counties, signaling that the outlets are a bellwether of riches in the devolved units.

The heavy concentration of branches in Nairobi indicates inequality in the country’s economic development, which has partly been attributed to the previous centralised system of government which guided sharing of resources since independence.
The devolved system of government raised hopes of addressing the economic imbalance, but analysts say there is a need to offer incentives to attract private investors to counties.

The 20 bottom counties have less than 10 bank branches each, with some like Samburu, Tana River and Mandera having three outlets each.

“Banks follow economic growth, as a result branches are concentrated where the centres of the economy are,” NCBA managing director John Gachora said.

“As banks raced for corporate clients in major cities and towns it led to a concentration in areas where they would find those types of clients.”

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    Written by Joshua Wanga

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