Kenyans may soon spend less when sending money through mobile money platforms such as M-Pesa and Airtel Money, after the Central Bank of Kenya (CBK) proposed capping transaction fees.
The move, part of the Kenya National Financial Inclusion Strategy 2025-2028, aims to lower the average cost of person-to-person (P2P) transactions from Sh23 in 2024 to Sh10 by 2028, easing the financial burden on millions of users.
The CBK said that while mobile money usage has grown substantially, most users still rely on basic services like person-to-person transfers, with fewer taking up advanced options such as digital credit, insurance, or savings.
“This is attributed to issues such as limited interoperability, high transaction costs, low financial literacy and product designs that do not reflect the realities of underserved groups,” the strategy document notes.
Access to mobile money among Kenyan adults has jumped from 27 per cent in 2006 to 82.3 per cent in 2024, yet growth in usage has begun to slow, with high fees cited as a key barrier.
Safaricom charges no fee for M-Pesa transfers of Sh100 or below, but fees increase to Sh13 for transfers between Sh501 and Sh1,000 and up to Sh108 for transactions from Sh50,001 to Sh250,000. Airtel Money allows free transfers within its network but charges between Sh6 and Sh105 for transfers to other networks.
The CBK highlighted mobile money’s role in widening financial access, saying it has been transformative for low-income groups, particularly women, youth, and rural communities.
“Mobile money is the single most transformative tool for financial inclusion. It has expanded access to payments, savings and credit for low-income groups, particularly women, youth and rural populations. It has also supported micro and small enterprises and enhanced household resilience since M-Pesa began operations in 2007,” the report states.
During the early phase of the COVID-19 pandemic, the CBK waived fees on transactions up to Sh1,000 from March 2020 to December 2022.
This led to more than 6.2 million new active users, with monthly P2P transactions rising from 162 million worth Sh234 billion to 440 million worth Sh399 billion. Although fees were reinstated in 2023, they remain below pre-pandemic levels.
Mobile money subscriptions currently stand at 47.7 million, reaching a penetration rate of 91 per cent, according to the Communications Authority of Kenya.
The 2024 FinAccess Survey shows mobile money leads in usage over banks, informal groups, insurance, and Savings and Credit Cooperatives (SACCOS), though growth has slowed, rising only from 22.2 per cent in 2021 to 23.2 per cent in 2024.
The CBK cautioned that fee caps could reduce telecom operators’ revenue, as P2P transfers account for nearly 40 per cent of M-Pesa’s earnings. Safaricom’s M-Pesa generated Sh161.1 billion in revenue in the year ending March 2025, with Sh62.9 billion coming from personal cash transfers.
The regulator stressed that it will work with telecom operators and Parliament to implement affordable digital financial services while ensuring clear and transparent pricing.
It also noted the need to balance “short-term commercial targets and long-term sustainable growth” so mobile money remains accessible and fair for all Kenyans.