Kenya : Mobile cash payments up by Sh108bn in six months
10 August 2018
The value of mobile-based transactions rose by Sh108.86 billion in the first six months of the year, reflecting the growing dominance of mobile payment services, Central Bank of Kenya’s (CBK) data published on Wednesday shows.
Mobile payments hit Sh1.92 trillion between January and June from Sh1.81 trillion in a similar period last year, putting average daily transactions at Sh10.61 billion.
Key sectors of the economy such as financial services, retail and wholesale trade, agriculture and health are increasingly integrating mobile payments into their operations.
This is in line with rising mobile subscriptions, which stood at 44.1 million or 95.1 per cent penetration in March, according to the Communications Authority of Kenya July data.
The CBK data did not break down the share by mobile operators but Safaricom’s M-Pesa controls more than three-quarters of the transactions.
“When M-Pesa came up (in March 2007), it was intended for the people who had been left out of the financial ecosystem but now everyone else, including the affluent, have taken to it and that’s why it has become a runaway success,” said head of financial services at EY East Africa Robert Nyamu in a recent interview.
“When you look at the financial services sector, for example, you have seen the big banks are no longer building brick-and-motor.
“It is all about ‘how do we get digitally connected to our customers and would-be customers and suppliers?’ The other sectors have followed suit.”
Average monthly settlements stood at Sh320.10 billion during the six months, Sh18.15 billion more than a year earlier.
Payments in June were, however, lower than the monthly average, standing at Sh317.41 billion, only higher than April (Sh313 billion) and February (Sh300.85 billion).
The number of agents also reduced to 197,286 from a record 202,387 in May.
Mobile money has become a key pillar of Kenya’s economy, with last year’s transactions valued at Sh3.4 trillion payments representing 46.95 per cent of Kenya’s national wealth – gross domestic product (GDP) – which stood at Sh7.75 trillion last December.
Treasury secretary Henry Rotich has this financial year increased excise duty on mobile money transfers to 12 per cent from 10 per cent, cash earmarked for funding universal healthcare. A court decision though suspended enforcement last month.
Source: Business Daily