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By  Editorial

What you need to know:

  • Mobile cash services in Kenya are unaffordable to many poor households and CBDC could offer the much-needed reprieve.
  • Although the CBDC is likely to eat into the lunch of mobile money payment service providers, it offers them an opportunity to innovate further.

The planned digital shilling by the Central Bank of Kenya (CBK) bodes well for improving financial inclusion in this country. The apex bank says its version of the Central Bank Digital Currency (CBDC) will be focused on affordable mobile phone financial services.

This makes economic sense as many Kenyans cannot afford the high transaction charges that deny them a chance to enjoy the gains of the convenience of technology. For instance, it costs Sh10-300 to withdrawal between Sh50 and Sh150,000 on Safaricom’s M-Pesa mobile money service and Sh6-105 to transfer similar amounts to registered users on the platform.

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