Markets & Finance

Youth spend big on electronic gadgets

phone

A whopping 92 per cent of the respondents in the StanChart survey reported that use of technology had made their lives easier. PHOTO | FILE

Kenya’s youth are spending their money on technological gadgets while giving little or nothing at all to social causes such as alms in church, a new survey on Africa’s spending habits shows.

The survey by Barclays Bank and South African based Columinate, found that 63 per cent of Kenyan youth regularly choose to invest any extra income in electronic devices (at 38 per cent), while the church or mosque get a paltry one per cent.

The majority of the youth said technological gadgets are important tools of personal advancement hence the heavy spending. 

Giving little to spiritual courses has, however, not prevented the youth from claiming spiritual fitness. More than half of the 823 youth surveyed or 52 per cent said they consider themselves to be prospering spiritually and cite finances as their main challenge.

Only 27 per cent of the respondents said they were prospering financially.

The list of spending priorities for Kenyan youth includes education and savings with 18 per cent reporting that they would spend more to improve their education. Eleven per cent said they would increase their savings.

“Most youth see investment, education and savings as the main drivers of prosperity that open the doors to economic growth,” Barclays Bank managing director Jeremy Awori said.

READ: Kenyan youth spend most of their income on clothes, airtime

Only nine per cent of those surveyed identified their educational achievement as a hurdle to prosperity.

At least 41 per cent of Kenyan youth surveyed cited lack of finances as the main impediment to their prosperity while a fifth said they lacked opportunities in the Kenyan economy. None cited poor health as an impediment to their growth.

The survey also found that only four per cent of Kenyan youth would consult their spouses or partners financially – a significant number (61 per cent) trust in advice from the banks.

The latest survey is a near reflection of an earlier one by Standard Chartered Plc and UK-based global research consultancy Globescan, which found that 66 per cent of Kenya’s middle class had tech devices at the top of their buying list in the past five years.

A whopping 92 per cent of the respondents in the StanChart survey reported that use of technology had made their lives easier, while 85 per cent said access to technology was important for Kenya’s development.

Besides, 85 per cent of the respondents said they planned to increasingly use technology to organise their finances in the next five years, pointing to the growing popularity of innovations such as mobile banking and mobile money.

This hunger for electronic gadgets has become a big driver of earnings for technology companies with telecoms services firms such as Safaricom reporting a huge take up of internet-enabled phones.

Safaricom reported early this year that the number of third generation (3G) devices on its network had risen to 3.1 million, of which 1.9 million were smartphones.

This was an increase from the previous year’s 2.3 million 3G-enabled devices, of which 1.2 million were smartphones.

Barclays, unlike other surveys that have sampled growing consumerism among Kenyan youth, found that most would not buy expensive clothes and luxury goods with increased income.

“What is particularly encouraging is that when asked further, the youth say they would rather invest in furthering their education than to spend on flashy consumer goods,” said Mr Awori.

Most of the youth who are attracted to designer labels said they would rather source them from the second hand market rather than pay exorbitantly to acquire the originals – posing a big conversion challenge to the global luxury brands with an eye on the Kenyan market.