Kenya’s mobile money sector has seen a significant increase in subscribers, as highlighted in a new report by the Communications Authority of Kenya (CA). The number of mobile money users has climbed to 38.7 million, achieving a penetration rate of 75%.
This growth is attributed to the elimination of withdrawal codes, which previously required Airtel Money users to withdraw funds within seven days or return the money to the sender.
Airtel’s removal of these codes on February 6, 2024, was part of a broader effort by the Central Bank of Kenya (CBK) and industry stakeholders to enhance mobile money interoperability as outlined in the CBK National Payment Strategy 2022-2025.
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Airtel explained, “This development effected February 6, 2024, comes in response to the Central Bank of Kenya (CBK) and industry players’ collaborative efforts to ensure seamless mobile money interoperability as outlined in the CBK National Payment Strategy 2022-2025.”
Kenya’s Policy Shifts and Increased Subscriptions
The CBK’s National Payment Strategy mandates that mobile money operators provide seamless customer experiences, allowing for direct transactions both on-network and off-network.
The new policy by the CA permits subscribers to transfer funds directly from M-Pesa to Airtel Money without the need for withdrawal codes, streamlining the process for users.
During the three months leading up to March 2024, the mobile money ecosystem onboarded an additional 700,000 subscribers, increasing the total to 38.7 million, up from 38 million in December 2023.
Despite rising subscriptions, the penetration rate slightly declined due to a revised population denominator following the 2024 Economic Survey. The CA’s report noted that while subscriptions increased, the recalibrated population figures affected the overall penetration rate.
Trends and Market Dynamics
This surge in mobile money subscriptions reverses a downward trend that began in March 2023, when the number of subscribers was 38.4 million, dropping to 38 million by June of the same year.
By September 2023, the number had increased slightly by 100,000. According to the 2024 Economic Survey by the Kenya National Bureau of Statistics, Kenya lost 600,000 mobile money subscribers over the year leading up to December 2023.
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In addition to the rise in mobile money users, active mobile (SIM) subscribers grew from 66.7 million in December 2023 to 68 million by March 2024. This increase represents a penetration rate of 132.1%, driven by customer win-back campaigns conducted during the period.
Kenya has experienced substantial growth in mobile money uptake in recent years, bolstered by government efforts to promote financial inclusion. In 2023, Kenya’s mobile money market generated KES 17.2 billion ($133.2 million), with M-Pesa dominating the market with a 96.5% share.
The CA’s latest report underscores the impact of regulatory changes and industry collaborations in fostering the growth of mobile money services.
As Kenya continues to enhance its financial inclusion strategies, the mobile money sector is poised for further expansion, driven by innovative policies and technological advancements that make financial services more accessible to the population.
