The rent-a-stress economy blowing into a full-scale economic liquidity crisis

A healthy financial system must help people build assets and stability, not just permanent dependency. [iStockphoto]

In Kenya today, a quiet tragedy is unfolding: citizens are working harder than ever, yet they are drowning financially.

Behind the relentless “hustle” lies a brutal reality where both the State and the lending ecosystem have created a trap rather than a springboard for wealth.

As a credit management specialist, I see two sides of the same coin crushing the Kenyan entrepreneur—systemic government default and a lending culture built on permanent dependency.

Kenya’s pending bills situation has evolved from an accounting backlog into a full-scale economic liquidity crisis. Currently, the combined exposure is estimated at over Sh700 billion. This includes about Sh524.8 billion owed by the national government and roughly Sh183 billion owed by county governments.

Nairobi City County alone accounts for nearly half of the county-level debt at Sh86.8 billion. We call these the “Mona Lisa” Files: verified, undisputed claims worth billions that are admired for their authenticity but never leave the room. We are currently managing 21 investor files worth Sh14.7 billion, where goods were delivered, and contracts honoured, yet payments remain pending.

Business owners have secured court decrees, only to find that winning a case against the State often means simply waiting for a decade while the Government Proceedings Act limits enforcement.

The human cost of this silence is staggering. Consider the case of a businessman (Kamau) who secured a Sh79 million court decree in 2012 against Nairobi County. 14 years later, his claim would stand at Sh6.3 billion if computed with accrued compound interest, yet he has lost physical assets and suffered mental instability while chasing what is rightfully his.

This creates a bitter contradiction: the system demands immediate tax compliance but operates on “extended timelines” when settling its own obligations.

Suppliers have inadvertently become the primary financiers of government operations, often at the cost of their own survival.

While the government traps capital at the top, a predatory lending ecosystem traps the individual at the bottom through “Loans from Hell”. For many Kenyans, repayment is no longer about reducing debt; it is about “renting stress”.

The cycle of “repay, top-up, and recycle” ensures that money arrives faster than wisdom and leaves faster than it can build an asset. Loan apps now push notifications like nightclub promoters, focusing on whether a customer can keep borrowing rather than whether they will grow financially.

The result is an economy where businesses are technically profitable but cash-flow insolvent. SMEs collapse, banks experience increased non-performing loans (NPLs), and auctioneers are busier than ever.

At Marathon, we increasingly see profitable SMEs failing not from lack of sales, but from poor receivables discipline and a lack of administrative accountability in the system.

Addressing this requires more than just speedy loans; it requires discipline. Payment timelines must be enforced with the same rigour as tax collection. Verified claims need settlement frameworks that don’t rely on the “feelings” of an official or how best you need to know some guys in government.

A healthy financial system must help people build assets and stability, not just permanent dependency. The real challenge for the Kenyan entrepreneur is no longer proving they are owed; it is convincing a system built on “rented stress” to finally honour its obligations.

-The writer is a certified public accountant, credit management specialist, and founder of Marathon Debt Recovery Ltd