Cash flows through mobile money agents, including those linked to banks and telecom firms, fell sharply by Sh430.3 billion in the first 11 months of last year, highlighting a shift in how Kenyans handle payments, tighter tax checks, and reduced cash availability.
Data from the Central Bank of Kenya (CBK) shows that cash managed by agents dropped to Sh7.514 trillion between January and November last year, from Sh7.944 trillion during the same period in 2024.
“This might be as a result of a range of factors,” said an official heading a digital payments unit in a local bank, speaking on condition of anonymity. “We are seeing tighter liquidity and a relatively high interest rate environment, which is pushing individuals to hold funds in interest-bearing accounts rather than cash.”
The CBK tracks agents of telecommunications companies, such as Safaricom’s M-Pesa, and banks operating agency banking outlets. The decline coincides with changes in Kenya’s payment landscape, where small transactions—like paying for groceries or matatu fares—are increasingly made through mobile phones, reducing the need to withdraw cash from agents.
Banks have also expanded their presence in digital payments, sometimes offering lower fees than telecom operators, making mobile transactions through banks more attractive to customers.
Since M-Pesa was launched in 2007 and agency banking followed, cash handled by agents has only fallen once before, in 2023, by a modest Sh35 billion. The current decline, however, does not indicate an economic slowdown.
Data from the Kenya National Bureau of Statistics shows that the country’s economy grew faster in the first nine months of last year compared to 2024. Other economic signals, including money supply, stock market performance, exchange rate stability, and cement use, also show increased activity as Kenyans remain active in economic transactions.
The sharp rise in agent cash handled during the Covid-19 years of 2020 and 2021 reflected emergency measures by CBK to support Kenyans. The largest increase occurred in 2021, when transactions jumped by Sh1.639 trillion after mobile wallet-to-bank transfers were made free of charge.
Agents earned higher commissions, receiving Sh28.21 billion in the year to March 2021, up from Sh23.82 billion the previous year, as M-Pesa-to-bank deposits outpaced bank-to-M-Pesa transfers for the first time.
M-Pesa Africa officials said the surge in deposits was largely driven by customers using M-Pesa wallets instead of depositing directly with banks.
