Macroeconomy: Understanding Loan Repayment Drivers for Tala
As the lead researcher, I investigated how macroeconomic factors like inflation and economic pressures affected loan repayment behavior in Kenya, with a particular focus on the role of Fuliza and other mobile lending platforms.
Through a combination of surveys with over 2,000 Tala users and in-depth interviews, I identified key drivers of repayment behavior and provided insights that helped improve Tala’s repayment process, resulting in a 10% increase in repayment rates.
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Tala Overview | Problem Statement | Methods | Insights | Recommendations | Impact | Lessons Learned
What Does Tala Do?
Tala is a financial platform providing instant credit, payments, and savings to underserved populations in emerging markets. By using mobile technology, Tala enables millions of people to access financial services, improving their financial well-being and empowering economic growth.
As the lead researcher for core micro-credit in Kenya, Philippines, Mexico, and India, I led research to understand user behaviors and needs across these markets. I was also the main researcher for exploring new credit products, collaborating closely with product managers, designers, engineers, credit and data teams to ensure Tala’s offerings were tailored to the unique financial needs of users in each region.
Why Was This Research Needed?
In early 2019, Tala observed a significant decline in loan repayment rates in Kenya, a trend that continued through mid-year. While the launch of Fuliza, a competing mobile overdraft product, was one contributing factor, Tala needed to understand whether macroeconomic factors and customer financial behaviors were also playing a role.
To inform future credit strategies, we explored:
What trends in customers’ financial lives were affecting repayment rates?
How did inflation, income changes, and borrowing behaviors impact their ability to repay loans?
How did customers perceive and prioritize lending platforms like Fuliza versus Tala?
How I Approached the Research?
To explore why loan repayment rates were declining in Kenya, I followed a layered research process that moved from high-level context to individual decision-making.
Literature review
I started with a review of economic forecasts, national statistics, and reports from Kenyan government agencies and think tanks. This helped frame early hypotheses about inflation, income volatility, and increased reliance on competing lending platforms.
Surveys
Based on the themes from the literature review, I designed a survey that reached 2,398 Tala customers across key segments—farmers, self-employed, government workers, and educators. The findings helped surface behavioral trends, including changes in income sources, spending patterns, and loan prioritization.
Statistical analysis
We analyzed repayment behavior and financial trends across user groups, identifying shifts in spending priorities, reductions in essential consumption, and rising usage of alternatives like Fuliza.
In-depth interviews
To understand the deeper “why” behind the patterns, I interviewed 6 Tala customers—3 self-employed and 3 farmers—some of whom had also participated in the survey. These interviews helped reveal how customers made trade-offs under financial pressure and what influenced their repayment and platform choices.
Collaboration
This work was closely integrated with ongoing efforts across product, credit, and finance, ensuring that every insight from research could directly shape decision-making.
Story in the Numbers: Discovery
What Needed to Be Done Next?
Based on the findings, I made several recommendations to improve repayment rates and better support customers navigating financial uncertainty:
Enable Partial Repayment
I proposed flexible repayment options that would allow customers to pay back loans in smaller installments. This idea was implemented and led to a 10% increase in repayment rates.
Address Urgent Financial Needs
Recommended designing new credit features that offer short-term relief without compounding debt — helping customers bridge gaps without overextending.
Improve Financial Understanding
Since many customers prioritized instant access over long-term consequences, I suggested integrating lightweight financial education moments into the loan experience.
Target by Segment
Encouraged product and credit teams to tailor offerings for high-risk groups like farmers and self-employed customers — those hit hardest by income volatility.
How Did This Shape the Product?
The research was shared with Tala’s product and credit leadership and became a foundational input for rethinking credit strategies across markets. By highlighting behavioral differences and repayment challenges—especially among users with irregular income—it shifted product conversations from broad optimization to targeted, needs-based solutions.
Here’s how it contributed to shaping the roadmap:
It sparked pilot testing of flexible repayment options, rooted in the insight that many customers intended to repay but couldn’t meet rigid deadlines.
It informed planning for short-term credit products, helping the team think beyond traditional lending models and toward crisis-sensitive design.
It led to early design exploration of lightweight, contextual financial guidance embedded in the borrowing experience.
It brought high-risk segments like farmers and gig workers to the forefront of segmentation strategy discussions.
As the COVID-19 crisis unfolded, these directions became even more relevant. The groundwork laid by this research helped Tala quickly adapt its lending strategy, enabling the team to better support customers facing income shocks, uncertainty, and increased financial pressure.
What I Learned?
Patterns are where the story unfolds.
Subtle behaviors — like repeated attempts at partial repayment — revealed deeper needs than interviews alone could surface.
Storytelling shapes strategy.
Structuring research in a way that connected across product, credit, and design helped ensure it guided not just ideas — but actual decisions.
Working through complexity sharpens direction.
Navigating diverse repayment behaviors and market contexts challenged me to provide clear, actionable guidance without oversimplifying.
Trust is built through thoughtful details.
Recommending changes like flexible repayment reminded me how intentional design can reduce stress and build long-term user confidence.