Why customer experience is the new currency in Kenya's lending sector

Patricia Nalyanya, a customer experience manager educating small business owners on matters loans. [Photos, Juliet Omelo] In Kenya's increasingly competitive financial landscape, banks and fintechs are rapidly learning that products alone-no matter how innovative-do not guarantee sustainable growth. The real differentiators are the experiences they provide their customers, and how effectively they educate them to use financial products responsibly and efficiently. For decades, many financial institutions prioritised rapid onboarding and loan disbursement, often overlooking the deeper needs of their customers. But now, as digital lending gains momentum and customers enjoy greater choice, the emphasis has shifted significantly. Micro, small, and medium enterprises (MSMEs)-which form the backbone of Kenya's economy-frequently encounter challenges such as complicated loan application processes, limited understanding of credit terms, poor communication from lenders, and unclear penalties or hidden fees. These issues lead to confusion, anxiety, and eventual mistrust. It is precisely here that customer experience (CX) becomes crucial. Institutions that place customers at the heart of their operations-valuing their experience and investing in their education-are seeing real, tangible returns in growth, loyalty, and retention. "Customer experience (CX) isn't merely about friendly customer service. It encompasses every interaction a customer has with a financial institution, from the first phone call or digital interaction to loan repayment and ongoing support," remarked Patricia Nalyanya, Manager - Customer Experience, PR and Branding. "Good CX means understanding what clients truly need, addressing their questions transparently, solving their problems swiftly, and treating them with empathy at every stage," she added. Demulla is one of the fintechs exemplifying this approach in Kenya. With its customer-centric philosophy captured in the slogan "We listen, we support, we deliver," it has quickly established itself as a leader not just in lending, but in customer care. "Demulla's approach recognises that each client's journey is unique, and by making each interaction meaningful, it builds lasting relationships," said Nalyanya. According to her, Demulla's CX strategy is built on three pillars: empathy, transparency, and reliability. She explains that loan officers are trained in both credit appraisal and empathy, ensuring they understand each customer's financial needs and repayment capacity. "Transparency is maintained through clear communication-loan terms, interest rates, and repayment schedules are explained upfront, with no hidden fees. "Reliability is reflected in timely responses and efficient issue resolution, both in person and via our USSD platform, reinforcing Demulla's reputation as a trusted financial partner," said the CX expert. However, an exceptional customer experience alone is not enough. Equally important is customer education. Many borrowers-especially micro and small businesses in Kenya-enter financial arrangements without fully understanding interest rates, repayment terms, or the consequences of default. This lack of awareness can lead to frustration, mistrust, and eventual churn. Recognising this gap, forward-thinking institutions like Demulla invest significantly in financial education initiatives. They run workshops and seminars on cash flow management, record keeping, budgeting, and responsible borrowing. "Importantly, these education efforts are not just occasional CSR activities; they're embedded directly into the customer onboarding and loan management processes," noted Nalyanya, adding: "The more knowledgeable a customer is, the more likely they are to use products effectively, repay promptly, and continue the relationship long term." These efforts are already having a tangible impact. Simon Okello, who runs a fabrication workshop in Siaya, credits Demulla with helping him transform his finances. "Before Demulla, my business was struggling," he said. "I didn't know how to create a proper budget and often mixed personal and business money. After the training, I now track my cash flow, follow a budget, and stock more efficiently." Rosebella Shiranda, a salon owner in Busia, echoed the sentiment. "The customer care and financial skills I gained helped me make my business more visible," she said."Now I attract more clients, and I can repay my loan on time because my cash flow is steady." Nalyanya further noted that institutions prioritising both customer experience and education enjoy higher retention rates. "Customers appreciate being respected, heard, and informed, which builds trust and loyalty. "When trust grows, customers are more likely to remain with the institution, take repeat loans, increase their loan sizes, and recommend the institution to others. "Demulla's consistently high retention and referral rates underscore this point, serving as clear evidence that a customer-centric strategy benefits both clients and the business itself." Moreover, by nurturing informed clients, financial institutions are directly contributing to financial inclusion and economic growth in Kenya. "Educated borrowers are better equipped to make informed decisions, manage their finances sustainably, and grow their businesses responsibly, creating a cycle of growth and opportunity that benefits the entire economy," noted Nalyanya. Ultimately, Kenyan financial institutions must understand that customer experience and education are not expenses-they are strategic investments in long-term growth. Companies like Demulla, which embed these values into their DNA, are already reaping rewards through loyal clients, lower default rates, and consistent portfolio growth.

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