Every Kenyan family now owes State lenders Sh1 million
National
By
Macharia Kamau
| Oct 10, 2026
The amount of money that every Kenyan owes local and international lenders that have been advancing debt to the country has nearly tripled over the last 10 years, following the government's aggressive pace of borrowing.
The debt per capita – which demonstrates the size of the national debt relative to population size – has risen to more Sh240,000 per person or nearly Sh1 million for a household of four people as of September this year up from Sh83,634 in 2016, according to an analysis of the national debt by the Institute of Economic Affairs (IEA).
While the debt per capita has been growing at a relatively fast pace of 11 per cent per year, the Gross Domestic Product (GDP) per capita – which is the value of all goods and services produced in the country and divided by the entire population – has been growing at a rather sluggish pace of about seven per cent annually.
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“As at 14th September 2026, the public debt is estimated at Sh240,288 per person, and is 2.9 times what it was a decade ago without correcting for inflation. As per the trend, approximately Sh14,705 of new debt is added per person annually,” said IEA in its quarterly macroeconomic debt report.
“Clearing the debt stock today would require Sh240,288 from every man, woman and child in Kenya – roughly Sh961,153 for a household of four. A decade ago, the same claim stood at Sh83,634 per person.”
IEA further noted that domestic borrowing accounts for Sh135,961 of each person’s share against Sh104,327 in external loans. The share of domestic debt has been on the rise in recent past as the government found it difficult to access loans from international lenders due to a mix of factors including lenders finding it more lucrative to lend in low risk development markets following increase in interest rates, which resulted in loans to Kenya and other developing countries becoming costlier.
“Domestic debt added Sh11,050 a person over the past year against Sh3,210 externally. Domestic debt is the more expensive of the two, so the servicing cost carried by each Kenyan is rising faster than the burden itself – stabilising it depends on the borrowing mix and the primary balance, not on the headline total alone.”
Domestic debt, according to the latest data by Treasury, stood at Sh7.46 trillion as of July this year and accounted for 56.5 per cent of the total public debt which stood at Sh13.22 trillion. External debt stood at Sh5.77 trillion, accounting for 43.6 per cent of public debt.
Kenya has in recent years been borrowing more locally, resulting in a departure from the past, when external debt had always accounted for more than 50 per cent of total debt.
In September 2023, domestic debt accounted for 46.4 per cent of total debt while external debt was at 53.6 per cent. Treasury expects this to continue in the medium term, with domestic debt increasing to account for 75 per cent of total debt. This has however been despite concerns of the government crowding out businesses and households in the the local credit market.
While the debt per capita has registered a growth of about 190 per cent over the 10 years, GDP per capita – which is the national economic output or the national cake divided by the entire population has been growing at a slower rate of 109 per cent over the decade to Sh329,593 last year from Sh157,681 in 2016. This has meant that the national debt is growing faster than the economic output required to repay it.