Being an entrepreneur in Kenya requires grit and financial savvy. One of the most important lessons is knowing when to use debt. A loan should always be used to generate more money than the interest it costs.
The 3-Month Reserve Rule
Always aim to have three months of operating expenses in a liquid savings account. If you don't have this, a logbook loan can act as a temporary emergency backup, but your primary goal should be building that cash cushion through disciplined profit reinvestment.