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How fintech tools can help cushion Kenyans during inflation

Data released by the Kenya National Bureau of Statistics shows that inflation for July 2022 was 8.3 per cent, compared to 6.5 per cent recorded three months earlier in April.

A quick visit to the supermarket confirms economic jitters on the minds of buyers and just about every investor within the region.

With the knock-on effects imposed on energy and food prices by global events such as the Ukraine war and the high petroleum prices, inflation is hurting households.

Inflation hurts underbanked Kenyans as their cash savings lose value. It costs them more in higher interest when seeking loans from financial players.

It should offer some comfort that our digital era provides customers access to products that past generations did not have as they battled past inflation.

With the expansion of and soon-to-be-regulated digital credit lenders, it is easier for customers to access financial services and tools that can help to manage inflation. Here are just but a few.

Savings tools

The current economic status has reduced the buying power of money. Fintechs offer customers tools to manage their money and make it easier to track expenses and monitor subscriptions and other payments made across the month. This helps us accurately detect 'money pits' and save effectively for when times get tougher.

Digital finance assets can also help customers split their bills across the month, enabling them to manage their money even with reduced salaries, and business profits and avoid late payment interest.

Financial literacy tools

Financial resilience during lurking inflation can be boosted once we understand how money works in everyday life. With smart data, Fintech can provide financial education to their customers’ mobile phones more effectively.

Additionally, programmes such as Tala’s MoneyMarch are already empowering Kenyans to make sound financial decisions based on a solid education.

Investment tools

In addition to short-term loans and savings, ‘wealth-tech’ can offer Kenyans investment opportunities on dollar-priced assets across the globe. Young professionals who tend to be more internet savvy can even look beyond traditional models of investment through fintech.

Flexible loan tools that can help during inflation

It is difficult to predict interest rates on your loan during inflation, but fintech features such as Tala’s Custom Due Date allow customers to choose their loan repayment date.