Electric Vehicles in Kenya: Can You Finance or Use Them as Collateral?

Introduction

Electric vehicles (EVs) are arriving on Kenyan roads, promising lower fuel costs and cleaner transport. But can you use them as collateral for loans, or finance them through logbook loans? Let’s break it down.

1. The EV Market in Kenya Today

• Small but growing, especially in Nairobi and Mombasa.
• Popular models: Tesla imports, Nissan Leaf, and BYD models.
• Challenges: Limited charging infrastructure and higher upfront costs.

2. Financing Electric Vehicles

• Banks and microfinance institutions are starting to offer EV financing.
• Logbook loans are possible if:
  • The vehicle is fully owned
  • Proper NTSA registration and logbook are in place
  • Lenders are comfortable with the vehicle’s resale value

💡 Tip: Because EVs are newer and pricier, lenders may offer smaller loans relative to the car’s value.

3. Using EVs as Collateral

• Technically, yes — if the EV has a valid logbook and NTSA verification.
• Considerations:
  • Depreciation rates may be less predictable for EVs in Kenya
  • Repossession and resale can be harder for lenders due to lower demand
  • Maintenance and battery health are key factors

4. Risks and Benefits for Kenyan Borrowers

Benefits:

• Access to a modern, eco-friendly car
• Potentially lower operating costs
• Can still secure funds through logbook loans if conditions are met

Risks:

• Limited secondary market may affect collateral value
• Higher insurance and maintenance costs for imported EVs
• Lender may impose stricter repayment terms

5. Tips for Borrowers Considering EV Collateral

• Verify NTSA registration and logbook authenticity
• Understand loan-to-value ratios for EVs
• Keep EV maintenance and battery health well documented
• Use a reputable lender who understands EVs

Conclusion

Electric vehicles are coming to Kenya, and yes, you can finance them or use them as collateral — but it requires careful planning and a lender who understands EVs. Logbook loans remain a viable tool, but borrowers should consider depreciation, resale, and lender requirements.

Explore Kifedha’s logbook loans to see if your car, even an EV, qualifies for quick, responsible financing.

Remember!

If you are short on cash to buy that electric vehicle or need a boost to pay for import duty financing talk to us today and get moving! Contact us through our contact form, call us on +254791573231 or visit one of our branches across Nairobi, Kiambu, Machakos, and Kajiado counties to explore your financial options.