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Mobile money transactions in Kenya soared to Sh6.5 trillion in the first nine months of 2024, marking a 13.2 per cent increase compared to the same period last year.

This growth is a significant reversal from the 2.7 per cent decline observed in the previous year, as Airtel Kenya’s decision to remove restrictive withdrawal codes revved up transactions in the sector.

This move allowed funds sent from M-Pesa to be seamlessly deposited into Airtel Money accounts, eliminating the need for weekly withdrawals.

For a long time, this call went unanswered as players in the sector called upon the regulator to deal with what was considered a move that favoured the leading telco, Safaricom.

Cashless transactions

However, the surge in mobile money transactions can also be attributed to other factors, including increased adoption of digital payments, government initiatives to promote cashless transactions, and the relaxation of regulations by the Central Bank of Kenya (CBK).

“This is a major benefit for Kenyans as they can now enjoy the convenience of real-time transactions which has cut out limiting user intermediary steps. In addition, the mobile money market will expand by allowing easy movement of money and enhancing financial inclusion,” Airtel Kenya Managing Director Ashish Malhotra said.

The Communication Authority of Kenya (CA), earlier this year, in its latest review of the sector also noted that the removal of transaction codes for M-Pesa and Airtel Money transactions led to a rise in uptake, improving convenience when transferring funds between the two mobile wallets.

KNBS further revealed in its survey that following the policy revision, February recorded the highest monthly transaction value at Sh790.8 billion, while September registered the lowest at Sh670.52 billion.

Increase in transactions

Despite Airtel’s market share in the sector more than doubling, M-Pesa retains its dominance in the market with a 93.4 per cent share as of June 2024, compared to Airtel Money’s 6.6 per cent.

During the period under review, mobile money subscriptions also saw an increase of 3.4 per cent, adding 2.6 million new subscribers to reach a total of 79.4 million.

The number of active mobile money agents also grew significantly, rising 14.4 per cent to 367,551 agents.

This sustained growth highlights how Kenya’s mobile money ecosystem has continued to thrive due to improved network coverage, user convenience, and regulatory efforts to reduce transaction costs. The CBK’s advocacy for interoperability and lower fees has further enhanced mobile money’s appeal, cementing its role as a cornerstone of the country’s financial system.

According to recent reports, the value of transactions rose to Sh7.95 trillion ($49 billion) in 2023, compared with Sh7.91 trillion the previous year, according to Central Bank of Kenya data. The number of mobile wallets jumped 6 per cent to 77.3 million at the end of 2023.