Business Debt vs Personal Debt Recovery in Kenya: What’s the Difference?

In Kenya’s growing economy, both individuals and businesses frequently extend credit—whether through goods sold on credit, informal loans, or formal contracts. But when the borrower fails to pay, the next critical step is recovery.

While the goal is always the same—to recover money owed—the approach for business debt recovery can differ significantly from that of personal debt recovery.

At Meridian Recoveries, we provide professional debt collection services for both scenarios, helping clients navigate the complexities involved. In this article, we’ll break down the key differences between business and personal debt recovery in Kenya, and how each process should be handled for the best results.

What is Business Debt Recovery?

Business debt recovery involves collecting money that is owed to a business by:

• Another business (B2B)

• A customer (B2C)

• An employee (e.g., salary advance, asset loss)

• A supplier, contractor, or partner

Examples include:

• Unpaid invoices

• Credit sales that went unpaid

• Loans advanced to employees or third parties

• Breached service contracts

• Dishonored cheques from business transactions

These debts usually originate from commercial agreements and are often supported by written contracts or official documentation.

What is Personal Debt Recovery?

Personal debt recovery involves collecting money owed by an individual, usually in a non-commercial or informal setting. These debts may include:

• Informal loans between friends or family

• Personal loans issued to colleagues

• Rent arrears from tenants

• Chama loan defaults

• Joint savings gone wrong

• Loans backed by title deeds or logbooks

While some personal debts are documented, others rely on verbal agreements, messages, or mobile money evidence (e.g., M-Pesa statements).

Key Differences Between Business and Personal Debt Recovery

Let’s compare the two across key categories:

✅ 1. Nature of the Relationship