The value of mobile money transactions handled by agents during the year that ended last December grew at a faster pace of 9.4 percent to hit Sh8.7 trillion, dwarfing a 0.6 growth recorded the previous year, data shows. Figures from the Central Bank of Kenya (CBK) show that the transactions jumped from Sh7.95 trillion in the year ended December 2023.
In 2023, the value had grown at the slowest pace in four years after the government raised taxes on such transactions by 25 percent during the second half of the year, making it more costly to send cash.
During the year, mobile money deals rose marginally from Sh7.91 trillion in 2022, marking a substantive decline from the 26.6 percent growth recorded in 2022. Last year’s rebound coincided with the scrapping of a code that forced customers on Airtel Money to withdraw cash within a week of receipt or see the money revert to the sender.
Airtel removed the requirement for the code in February last year, allowing its subscribers to receive money from any registered mobile money platform and notably feeding off the dominant M-Pesa.
The Communications Authority of Kenya (CA) had earlier said that the removal of the code on Airtel Money users was critical in pushing the volumes of cash moved via mobile money.
Last year, agents aligned to M-Pesa, Airtel Money, and other mobile money platforms handled the highest amount of cash in February at Sh790.8 billion while the lowest was in September at Sh670.5 billion.
The annual rise defied Airtel’s decision to increase charges for sending and receiving cash across other networks where subscribers pay Sh25 up from Sh22 to withdraw between Sh101 and Sh500.
The country’s second-largest telco said that it increased the charges following the introduction of the 15 percent excise tax on transaction fees charged on money transfer services by cellular phone providers.
Safaricom’s M-Pesa is the dominant money transfer platform in the country, with well over 92.3 percent share in subscriber numbers as per the latest industry data, followed by Airtel Money at 7.6 percent.
M-Pesa is the single largest revenue stream for Safaricom, highlighting the impact of mobile money services to the telco.
During the half year ended September 2024, Safaricom’s revenue from M-Pesa in the Kenyan market grew 16.6 percent to Sh77.22 billion, driven by a 13.1 percent rise in the average revenue per user to Sh389.27.
The popularity of mobile money remains on the rise driven by increased and better network coverage by telcos and also the ease at which subscribers can send and receive money.
