Imagine this:
You wake up one day to find your bank account drained. You call the bank, furious. They tell you your neighbor borrowed money in your name. You never signed anything. You never received the money. But now you’re legally expected to repay it.
That, in essence, is the question Kenya now faces.
The Debt No One Asked For
A few weeks ago, businessman Jimmy Wanjigi appeared on Spice FM, raising concerns that most Kenyans had long buried under headlines and inflation. He wasn’t just complaining about high debt. He was asking whether that debt was even legal.
And now, following a landmark move by the Central Bank of Kenya (CBK), which has backed a court petition to investigate the legality of this debt, his concerns have exploded into national conversation.
This is not just about numbers anymore. It’s about consent. About law. And about whether Kenyans are being forced to pay for loans they never agreed to.
What Is Odious Debt?
Here’s a simple analogy:
Let’s say your spouse secretly takes a loan to fund a luxury vacation with their friends. You didn’t know. You didn’t agree. The money wasn’t spent on the household. Should you have to pay it back?
That’s what “odious debt” means.
It’s a legal doctrine that says:
“If a government takes on debt without the people’s consent, and spends it against the people’s interest, that debt is illegitimate.”
That’s the basis of the constitutional petition now before the High Court, filed by Senator Okiya Omtatah.
Read: Is the CBK Quietly Admitting the Country’s Debt Is Illegal?
Tracing the Debt: Who Took What, and When?
Wanjigi walked Kenyans through a timeline of how we got here, like peeling back layers of a rotten onion.
Let’s compare it to a family household:
| Administration | Year | National Revenue | National Debt |
| Moi | 2002 | Sh170B | Sh600B |
| Kibaki | 2013 | Sh1 Trillion | Sh1.9 Trillion |
| Uhuru | 2022 | Sh2 Trillion | Sh8.7 Trillion |
| Ruto | 2025 | Sh2.4 Trillion | Sh11 Trillion |
Imagine your household earns Sh2.4M a year… but owes Sh11M on credit cards, car loans, and mortgages. Worse still, you’ve already paid Sh10M over 10 years in repayments… and your balance still keeps rising.
That’s the Kenyan situation. A financial treadmill with no finish line.
Where Did the Money Go?
Wanjigi pointed out that many of the loans have not resulted in real value.
Take the Standard Gauge Railway (SGR) , a project that was supposed to boost trade and industry. Instead, it turned into a maintenance black hole. Billions are spent every year just to keep it running, yet it doesn’t generate enough revenue to pay for itself.
The Disappearing Budget Truth
Here’s where things get murky.
In President Ruto’s first budget, Parliament approved Sh 313 billion in foreign borrowing.
But then, surprise! The Treasury later announced we’d borrowed Sh700 billion from abroad and Sh1 trillion domestically. That’s more than double what Parliament approved.
Imagine your office approves a Sh500,000 project budget. One month later, the accountant tells you they spent Sh1.8 million… and offers no receipts. Would you call that legal? Or even logical?
This is what Wanjigi calls financial manipulation, borrowing beyond what was approved, without clear explanations. And it may be a violation of Articles 211 and 201 of Kenya’s Constitution.
Read: Can SHA Actually Survive? Here’s What the World Bank Thinks
What the Law Demands
Let’s break down the rules, because yes, there are rules.
Kenya’s Constitution and Public Finance Management Act (PFMA) are clear:
- Article 211: All national borrowing must be approved by Parliament.
- Article 201: There must be transparency, accountability, and public participation.
- Article 226(5): If someone misuses public money, they are personally liable.
PFMA rules include:
- Borrow only for development, not for day-to-day expenses.
- Submit every loan for Parliamentary review and approval.
- The Public Debt Management Office must monitor and report all borrowing.
In short: Government loans must follow the same logic as taking out a mortgage. You can’t just borrow cash in the shadows and hand the bill to taxpayers later.
However, Omtatah’s petition also challenges 2014 amendments to the PFMA, arguing they were unconstitutional for bypassing Senate involvement, violating Article 110 of the Constitution.
The amendments allegedly:
- Removed Oversight: Treasury could negotiate loans and open foreign accounts without Parliament’s approval.
- Bypassed the Consolidated Fund: Loan proceeds could be held offshore, sidestepping Articles 206 and 228.
- Enabled Odious Debt: Funds were borrowed for non-development purposes, contrary to Section 15 of the PFMA.
The Central Bank Joins the Fight
In a rare move, the CBK sided with the petitioners, calling the matter “constitutionally significant.” They even supported forming a multi-judge bench, a legal power move signaling this is no ordinary case.
The petition filed on April 24, 2025 by Omtatah, Petition E216 of 2025, could change how Kenya defines lawful borrowing.
If the court finds that certain debts were illegal, it could:
- Invalidate those debts.
- Trigger a refund process.
- Hold public officers personally liable, yes, with their own money or jail time.
What Happens If the Court Agrees?
So let’s say the court agrees that some of Kenya’s debts are odious, that they were taken without proper authority, spent against the public interest, and never meant to benefit ordinary Kenyans. What changes?
A Breather for Citizens
If even a portion of these debts is struck down, the impact could be immediate and profound. Kenya spends over KSh 1.6 trillion every year on debt repayments, money that could instead go to hospitals, schools, roads, and clean water.
Think of it this way: instead of higher VAT, fuel levies, or housing taxes, the government could use that freed-up cash to actually improve lives, especially for low-income households, small businesses, and workers trying to stay afloat.
Read: Why Fuel Prices Could Rise Under New World Bank Proposal
The Human Cost for Those Who Approved the Loans
Now, what about the people who signed off on these debts?
Names like Uhuru Kenyatta, Henry Rotich, and top Treasury officials keep surfacing in this petition. If the court rules that any of the loans were illegal or mismanaged, they could face consequences under Article 226(5) of the Constitution.
That article is blunt: If you misuse public money, you’re personally liable.
But here’s the problem, legal enforcement is rare. The Constitution allows it, but the justice system doesn’t always follow through. Unless there’s clear evidence of corruption, they won’t be arrested. Not automatically.
Who’s Holding the Stick?
Multiple institutions could be drawn into this legal reckoning:
- The Courts will decide whether the debts qualify as odious, and what to do about them.
- The Auditor-General and Controller of Budget could be asked to explain how billions were paid out without red flags.
- The EACC and Director of Public Prosecutions can step in if corruption is proven.
- Parliament may be pushed to rewrite parts of the law, especially around loan approvals and oversight.
Could This Shake the Global Market?
Yes. And that’s where it gets even more complicated.
If Kenya walks away from certain debts, global markets will take notice, and not kindly.
- Credit rating agencies might lower Kenya’s score, making future borrowing more expensive.
- The IMF and World Bank could tighten their lending terms or pause support altogether.
- Foreign investors could pull back, causing the shilling to slide and increasing import prices.
- China, EU members, and other lenders might retaliate, either through trade or aid policy.
It’s Been Done Before
This wouldn’t be the first time a country said “no” to illegitimate debt.
- Mexico, in the 1860s, refused to pay French-backed debts imposed by a puppet regime. They faced sanctions, yes, but they kept their sovereignty and fiscal control.
- Costa Rica, in the 1920s, walked away from debts taken by a dictator. It hurt short-term credit access, but allowed the country to reinvest in itself and recover through sound governance.
So… Who Are We Actually Paying?
Most of Kenya’s debt is owed to foreign creditors, many linked to powerful governments, banks, and opaque contractors. When we pay debt service, that money leaves the country.
Wanjigi argues that Kenyans are being taxed more, to pay for loans that were never meant to serve them. And that’s why this court case is not just economic, it’s moral.
You didn’t benefit. You didn’t agree.
Wouldn’t you ask: Why am I paying for this?
That’s the question now before the courts.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.