Hidden bank charges: Why Kenyans need to watch their finances closely
A 2024 customer perception survey released by the Kenya Bankers Association (KBA) in February this year ranked those dissatisfied with their banking services at 47.3 percent followed by 46 per cent whose concerned are fees and charges
For many Kenyans, banking seems straightforward: deposit money, withdraw when needed, maybe take a loan.
But increasingly, customers say they are getting hit by fees they didn’t expect. Hidden charges embedded in loan contracts, mortgage agreements, digital credit apps, credit cards and other financial products.
Experts warn that lack of transparency by banks and lenders is costing ordinary people hundreds to thousands of shillings through what many see as unfair practices.
Hidden bank charges may seem small or insignificant at an individual level ranging from a few hundred or a thousand shillings here and there.
But for many, especially those using credit frequently or taking mortgages, these charges can accumulate and worsen financial vulnerability.
As demand grows for more transparency in Kenya’s banking sector, consumers increasingly have the chance to insist on fairer, clearer terms. But vigilance remains key.
Some of the most common hidden bank charges in Kenya include;
- Account maintenance or ledger fees
Many banks impose monthly or yearly maintenance fees even if your account has low or no activity. These include ledger fees, statement fees, and card replacement charges.
- Loan processing fees
When you take a loan, there may be an upfront fee for processing or arranging the loan. Sometimes this fee is deducted before disbursement, so you don’t receive the full amount though you repay the full principal plus interest.
- Insurance, valuation, legal, stamp duty and other ancillary charges on loans and mortgages
Especially in mortgage contracts, banks often add charges like property valuation, insurance, legal fees, title transfer fees, stamp duty, etc.
A 2024 customer perception survey released by the Kenya Bankers Association (KBA) in February this year ranked those dissatisfied with their banking services at 47.3 percent followed by 46 per cent whose concerned are fees and charges.
It also singled out poor service, fees and charges rank high among customer concerns in a new banking survey released on Wednesday.
The two factors showed that service quality and pricing remain central to customer loyalty and retention.
Transparency issues also ranked high among customer concerns, with 31.9 per cent of respondents expressing dissatisfaction with the clarity of their banking relationships.
Additionally, service-related problems such as long wait times (30.1 per cent), security concerns (29 per cent), and poor issue resolution (32.7 per cent) further highlighted the need for banks to improve operational efficiency and build stronger customer trust.
Competition Authority of Kenya Director General David Kemei said that there are concerns regarding transparency in banking fees and charges.
He pointed out that despite past market studies conducted by CAK in 2015 and 2018 that exposed hidden charges, customers continue to report dissatisfaction with non-disclosure of fees and high transaction costs.
“We still see issues of unclear fee structures and high service charges.
Banks must adopt more transparent pricing models and ensure customers fully understand the costs associated with financial services,” he said.
Despite the complaints, customer loyalty to their banks also grew to 58.1 per cent in 2024 from 54.8 per cent in 2023.
