[PwC] Building trust and financing for Kenya’s agricultural growth

By John Kamau, Partner, Financial Crime Advisory, Eastern Africa Region, PwC Kenya and Sharon Kerubo, Senior Associate, Forensics, Deals, PwC Kenya

Before the city lights, before the degrees, before the office jobs, there was the land. For many Kenyans, the memory of home is deeply rooted in the soil: the scent of rain falling on dry earth, the rustle of maize in the wind, or the quiet strength of a grandmother planting beans with her bare hands. Farming, for countless families, was not just a way of life, it was how school fees were paid, homes were built, and communities endured. Agriculture is more than an occupation, it is memory, identity and legacy. Kenya’s fields have grown more than food; they have grown generations.

This very foundation that has sustained the country for decades remains one of its most neglected and underfunded sectors. Agriculture plays a central role in Kenya’s economy, contributing an average of 21.8% to GDP between 2000 and 2024, employing over 70% of the rural population and 40% of the total population. Despite this, access to affordable and reliable financing remains elusive. The government allocates less than 3% of the national budget to agriculture and formal credit to the sector accounts for less than 5% of total lending by commercial banks. While donors and private sector actors have stepped in, the financing gap remains wide and persistent.

So why does agriculture receive so little funding despite its importance? The answer lies in the perception of risk. Ask any banker, and they’ll likely admit they would finance commercial real estate or manufacturing ventures long before considering agriculture. Their caution is not without reason. Farming is often seen as unpredictable, heavily dependent on rainfall, vulnerable to fluctuating market prices and lacking the structured risk mitigation mechanisms found in other sectors.

This perception has made financiers hesitant and, in many cases, rightly so. The sector suffers from weak institutional frameworks, limited data for credit assessment and a history of mismanagement. Donor funds have stepped in to fill the gap, supporting various agricultural initiatives. However, even these efforts are sometimes met with scepticism. At PwC, we’ve observed growing concerns among donors about the misuse of funds, lack of accountability and the absence of transparent structures for disbursing and tracking resources. These challenges have further eroded confidence in the sector’s ability to absorb and manage financing effectively.

Recognising the critical role agriculture plays in Kenya’s economy and livelihoods, various stakeholders are now stepping up to bridge the financing gap. The government is taking a lead role through the proposed Agricultural Development Fund, a revolving fund designed to pool resources from multiple actors to ensure consistent and sustainable financing for the sector. Donors too, are showing renewed interest, directing funds toward initiatives that strengthen agricultural value chains and improve resilience.

Meanwhile, financial institutions are beginning to rethink their approach. Some banks have started bundling agricultural loans with insurance products to cushion farmers against climate and market-related shocks. This shift in institutional thinking, though long overdue, is a welcome sign of progress. It signals a growing recognition that agriculture, when properly supported, can be both a viable investment and a powerful engine for inclusive economic growth.

At PwC, we are committed to ensuring that every stakeholder in the agricultural ecosystem derives value from their contribution. We recognise that agriculture is a dynamic and evolving sector, and we are continuously working to identify solutions that close existing gaps, strengthen accountability and rebuild trust.

What’s needed now is a paradigm shift in how we approach agricultural financing and governance. When funds are managed transparently and effectively, farmers are empowered, markets function more efficiently and young people begin to see agriculture not as a last resort, but as a viable and rewarding opportunity. Most importantly, the country builds resilience against food insecurity and economic shocks. Only through collective effort and innovation can we unlock the full potential of Kenya’s agricultural sector, for today and for generations to come.