Early financial inclusion can lead to exclusion: experiences of Kenyan youth (3/5 blog on youth & ID for UNICEF)

Hélène Smertnik and Savita Bailur

This blog is one of five blogs from our work on children and the tension between identification and identity in a digital age. Other blogs include:

  • Identification and identity for children in a digital age
  • Identification, identity and sexuality for youth in Brazil
  • Refugee identification and identity for children in Lebanon
  • Biometric identification and identity for children in Thailand
An engaged group of students, ages 15 to 18, at their high-school in Kisumu, Kenya’s third biggest city. Photo credit: H. Smertnik

At Caribou Digital, with the support of UNICEF, we undertook a multi-country research study to understand the interplay and challenges between identification, identity, and digital ID for children in their journey from 0 to 18 years old. What tensions appear between the ID credentials (ID) one owns, the way one is identified (identification), and the way one identifies oneself (identity) during this formative time?

To do so, we conducted fieldwork in four countries: Kenya, Brazil, Lebanon, and Thailand. Each country surfaced a different theme and ID challenges: in Brazil we saw differences between identification and sexual identity; in Lebanon, tensions in the identity-making of refugee children; and in Thailand, the confusing experience of acquiring biometric ID at a young age.

In Kenya, we focus on youth’s early and, as a result, informal access to financial tools which are only legally accessible at 18; we found that an “inclusive” journey towards financial independence can potentially become exclusionary when started too early.

This qualitative research was conducted over two weeks during which we interviewed a total of 100 respondents through focus groups and interviews. These included accompanied children (11 to 14), youth (15 to 20), parents, caregivers, frontline workers (school heads and teachers, health workers, and NGO representatives), and government experts. We focused on Kisumu (Kenya’s third largest city) and its surrounding rural areas.

By middle childhood, children are accessing mobile apps and, often, mobile money

The graphic below maps a Kenyan child’s accumulation of ID credentials as well as personal data, from childhood to adulthood. ID credentials are represented by the solid grey blocks, divided by development age ranges. These credentials are both legal, such as a birth certificate, and non-legal, such a Facebook account. The floating dots illustrate the child’s personally identifiable information (PII) as it expands over time (e.g. a date of birth, a password, or a Google search). By the time a child reaches 18, a huge amount of PII is available on them.

Identification, identity, and digital ID in Kenya for children between 0 and 18

Visual developed with UNICEF

By middle childhood, awareness and use of ID credentials begins: around age 13, most children will pass their first school exams for which they will need to show an ID (i.e. their birth certificate). While youth have to wait until 18 to obtain their National ID card (NID) and obtain full and formal independence, particularly financial independence, some of the adolescents we spoke with didn’t wait until 18 to begin using their parents’ or older siblings’ mobile phones, notably to access financial apps.

Youth are cautious about their online presence but less cautious about mobile money use while underage

“Many African parents say that to perform, their children shouldn’t have a phone…The only digital platform I use is YouTube. I love fashion and watch plenty of shows. But any other trace of me on the internet I would not want.” — Paulette, 16 year old student in Kisumu

Many of the youth we spoke with were as cautious of their presence online as Paulette, not wanting to share too much of their personal information online (although they may also be unaware of how much data they generate). This attitude stemmed from peer warnings and parents’ own caution around having their children use the phone. Despite this caution, the same youth often started using their parents’ mobile money account as young as 12 or 13. While technically illegal (the owner of the phone and the M-PESA account should conduct the transaction and show an ID), interviewees stated it was common practice.

“I use my phone to learn and meet people but no dating!!! For M-Pesa, it’s my mother who is registered. She gives me her ID number and I go to the agent. No need for a physical ID. When I use my sister’s account, I use my sister’s ID.”Shamza, 15 year old student in Kisumu

Accessing mobile money from a young age is not the primary issue here: after all, some children receive “piggy bank” money from a young age. The problem arises from the wider array of mobile financial services, particularly loans, that become suddenly available to youth while they are still not fully aware of the implications of using these services.

Becoming financially included too early in life can lead to exclusion later

“I was in need of a bit of cash and downloaded Tala on my phone… actually I was seeing a girl and wanted to take her out. I read some bad reviews on Facebook, someone saying that they didn’t know why they were blacklisted when they had reimbursed, but I decided to try anyway. I needed an M-PESA account to register with Tala, and my brother was ok so I registered on M-PESA with his ID. The app says it collects some information on us — not sure what — to see if we can get a loan. For me it took two days and I got the loan.”Paul who started using apps at 16

Discussing with Paul about the implications of getting loans before being legally able to and using an ID that wasn’t his revealed that he had not considered these matters earlier. He did realise that his brother would be exposed, as the ID holder, if he ever did wrong. He also noted that it may mean that his brother could take his money and that seemed to be a motivation for him to change his mobile money account to his own ID.

Accessing financial tools and thus being “included” relies on identification, specifically the National ID (NID). Over the years M-PESA have made the NID requirement more and more stringent in order to avoid fraudulent usage of the service. However children and youth conducting transactions either on behalf of their parents or for themselves via their known and trusted neighbourhood agent is a grey zone. While this flexibility is most likely advantageous, in some situations it could make youth less conscious of the impact of using mobile money for services other than simply sending and receiving money.

Loan apps such as Tala, as Paul mentions, or Branch offer quasi-instant loans to youth who do not always know or understand the terms and conditions and sometimes find themselves blacklisted and unable to access financial services for failing to repay as little as 200 KES (2 USD), seriously impacting their credit history as they grow older.

Youth are particularly exposed and vulnerable as the main target of this easily accessible money (e.g. radio stations in Kenya make these loans sound almost like free money). If apps do not ask for too many formal credentials and make the background checks invisible, they appear extremely attractive. However, it’s likely that poor or no repayments will place debtors on blacklists that will affect them and possibly financially exclude them as adults.


The familiarity with using mobile phones from a young age — as well as less stringent KYC requirements compared to banks — may lead some youth to undervalue the formal nature of digital financial transactions and consider the phone as a gateway to easy money. As we have seen, this has implications for both the youth using these digital financial services without understanding the consequences (particularly loans) and the holder of the ID who will be held accountable for any misuse. Special attention therefore needs to be paid to youth’s usage of digital financial services:

  • For government and community level engagement to ensure education of both families and youth about digital financial literacy and privacy (not sharing IDs the way one doesn’t share an ATM pin). Parents should know to adopt the right attitude when asking their children to do transactions for them and convey the official nature of financial transactions which require official documentation.
  • For regulators to engage with digital financial service providers, such as Tala, on the need to ensure strict ID requirements and cross checks to ensure the age and solvency of the borrower.
  • Frontline workers, particularly teachers, can play a role in directly informing children of the need for caution and the implications of using financial services.


We were particularly aware of the complexity of talking about ID with children and youth and underwent a comprehensive UNICEF Ethics Board review prior to beginning fieldwork. We also made sure to create a friendly, non-intimidating atmosphere with the usual contract of anonymity. We were very grateful for the time and attention that children, youth, families, and officials gave us.

We would like to thank UNICEF Kenya for their support during this field research, particularly Minu Limbu and Moses Rono. Finally, our sincere thanks to our Research Assistant, Diana Mwaga, for her support, coordinating the field research, recruiting respondents, interpreting interviews and focus groups, and transcribing these over the two weeks.

In addition to the above, we are very grateful to Jonathan Donner (Caribou Digital) and the UNICEF team for feedback. These blogs represent our views and not those of UNICEF.

Author: Savita Bailur

I’m a researcher in digital development. Currently a Research Director at Caribou Digital and Adjunct Associate Professor at the School of International and Public Affairs, Columbia University. Previous experience includes USAID, World Bank, Commonwealth Secretariat, World Wide Web Foundation, mySociety, Microsoft Research India and University of Manchester (lectureship).

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