Kenya’s Bold Plan to Drastically Cut Mobile Money Transaction Fees
Kenya’s digital finance landscape is on the cusp of a significant transformation as the Central Bank of Kenya (CBK) unveils an ambitious strategy to substantially reduce mobile money transaction costs. This pivotal initiative, detailed in the draft Kenya National Financial Inclusion Strategy (NFIS) 2025–2028, aims to make digital financial services not only more affordable but also universally accessible for all Kenyans. This strategic move is poised to deepen financial inclusion across the nation, reinforcing Kenya’s leading role in Africa’s burgeoning digital economy.
Unpacking the Strategy: Targets, Obstacles, and Technological Levers
The CBK’s plan is assertive: a massive 57 percent cut in average mobile money transaction fees. By 2028, the goal is to bring the typical cost down from the current $0.18 (approximately KES 23) to a mere $0.07 (KES 10). CBK Governor Kamau Thugge and the institution underscore that high charges are a significant impediment to wider adoption, despite 83 percent of adult Kenyans already possessing a financial account. Millions, particularly in Kenya’s rural areas, still depend heavily on cash, where transaction costs can escalate to an alarming 6.9 percent of the transfer value. To achieve these lower costs, the CBK proposes implementing fee caps specifically for peer-to-peer (P2P) transactions. Technology forms the backbone of this vision, with the NFIS advocating for a national Fast Payment System. This system is designed to enable instant, round-the-clock transfers seamlessly between banks and mobile platforms, ensuring a robust and efficient digital financial ecosystem.
This proactive measure by Kenya’s Central Bank represents a pivotal step towards a more equitable and efficient digital financial landscape. By dramatically lowering mobile money costs, Kenya aims to unlock new opportunities for economic growth and empower its citizens, particularly those in underserved communities. The strategy reinforces Kenya’s leadership in African fintech innovation, setting a benchmark for financial accessibility and affordability that could inspire other nations on the continent. The successful implementation of these reforms could solidify Kenya’s position as a trailblazer in global financial inclusion.
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