Cash transacted through mobile money platforms in the year to June 30 equalled nearly half the national production, according to latest official statistics. The payments hit Sh3.574 trillion between July 2016 and June 2017 in about 1.7 billion transactions, Central Bank of Kenya’s latest numbers show.
The value was 15.8 per cent higher than the previous year’s Sh3.086 trillion.
This means the transactions were an equivalent of 48.76 per cent of Kenya’s estimated Gross Domestic Product (GDP) of Sh7.33 trillion ($70.53 billion) as of December 2016 going by the World Bank Group data.
Between January and June this year alone, about Sh1.81 trillion was moved through mobile platforms representing a 13.84 per cent rise.
Record monthly transactions were witnessed in March this year at Sh320.180 billion, a 17.03 per cent rise compared with the previous month’s Sh273.59 billion.
The continued expansion of mobile payments in which Kenya is a global leader has largely been at the expense of plastic cards payments’ whose growth has been stagnant. The cards’ value, largely of debit cards, dropped by a marginal 0.29 per cent year-on-year to Sh1.39 trillion in June, while the value of transactions in six months fell 1.2 per cent to Sh690.17 billion.
“M-Pesa and similar digital financial services represent a significant improvement in the national payments technology, reducing transaction costs and lowering the barriers to entry into the formal financial system,” former CBK governor Njuguna Ndung’u wrote in a policy brief published by the University of Oxford’s Blavatnik School of Government last week.
“Financial institutions in Kenya have embraced M-Pesa as a platform to manage micro accounts, build customer deposits and broaden their customer network.”
The country’s six mobile money companies operated 34.178 million accounts in June, with the agents at a new high of 165,109.
The mobile money platforms include Safaricom’s M-Pesa, Airtel Money, Telkom Money, Equity Group’s Equitel, Tangaza and MobiKash.
The statistics, however, indicate mobile money user accounts fell for two straight months having hit a record 34.286 million before slowing to 34.205 million in May. Mobile money platforms are rapidly diversifying from cash transfer services to channels for paying monthly utility bills, buying goods and services, remittances and lately investment in bonds through the M-Akiba where Treasury is targeting to raise Sh5 billion in phases.