Access to credit remains a crucial pillar of agricultural activity in Kenya, with farmers primarily borrowing to finance essential farm inputs and expansion.
Findings from the Central Bank of Kenya’s Agriculture Sector Survey for September and November 2025 show that the dominant reason for loan applications was the purchase of inputs such as fertiliser, seeds, and pesticides.
In September, an overwhelming 94 per cent of respondents cited input purchases as their main reason for borrowing, although this declined to 73 per cent in November, suggesting some easing in input financing pressures or increased access to alternative support mechanisms.
Labour costs followed as the second most common reason, with 53 per cent in September and 47 per cent in November, reflecting the labour-intensive nature of Kenyan agriculture.
Diversification of agricultural activities gained momentum, rising from 38 per cent to 48 per cent, indicating a shift by farmers towards risk mitigation through mixed farming, agribusiness ventures, and alternative income streams.
Meanwhile, borrowing for equipment and machinery purchases increased from 16 per cent to 27 per cent, highlighting growing interest in mechanisation, albeit from a low base.
Loans for farm expansion and land acquisition declined from 28 per cent to 18 per cent, possibly reflecting high land costs and uncertainty in the broader economic environment. Similarly, leasing or hiring farm equipment saw a slight drop from 28 per cent to 22 per cent.
The “other” category rose sharply from 3 per cent to 17 per cent, pointing to emerging or unspecified financial pressures, including household needs and debt refinancing.