Mobile Money Subscriptions in Kenya Rise to 38.7 Million
Mobile money subscriptions in Kenya have grown to 38.7 million, translating to a penetration rate of 75%. This is according to the latest sector statistics released by the country’s telecoms regulator the Communications Authority (CA).
The Third Quarter Sector Statistics Report provides the performance and trends in Kenya’s ICT sector for the period 1st January to 31st March 2024.
According to the regulator, the growth in mobile money is attributed to the removal of withdrawal codes for transactions sent from M-Pesa to Airtel Money, which means that funds can now be transferred directly into an Airtel Money account (wallet).
This development effected on February 6, 2024, came 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 Payments Strategy 2022-2025.
The National Payments Strategy requires all mobile money providers to ensure a seamless customer journey across their different channels – Sim Menu, USSD Menu and App to allow on-network and off-network direct transactions. This will ensure a secure, fast, efficient and collaborative payments system that supports financial inclusion and innovation that benefits Kenyans.
The growth in mobile money subscriptions also points to increased mobile money use that has seen Kenya emerge as a global leader in the fintech space.
In the past two decades, Kenya has experienced rapid growth in its fintech ecosystem, led by mobile money and other digital financial services. This growth can be traced back to 2007 when the country’s leading telecommunications provider Safaricom launched M-Pesa.
M-Pesa is a mobile money service that allows users to send money, pay bills, and save or borrow money all from their mobile phones. The mobile money service has turned out to be an instant success in changing the ways financial services are accessed, particularly in rural and underserved areas where the traditional banking infrastructure was very scarce.
The launch of M-Pesa was a game-changer for the financial landscape in Kenya as it was leveraging the widespread availability of mobile phones. The service not only bridged that gap in financial inclusion but also set the precedent for other companies in fintech to follow making the sector grow explosively. It also presented a fertile ground for fintech startups to thrive. As of now, Kenya has over 200 fintech companies, making it one of the most dynamic fintech hubs in Africa. These startups operate in various areas, including mobile banking, payments, lending, insurance, and blockchain technology.
Looking ahead, analysts predict that the Kenyan mobile wallet payments market is forecast to grow by 5.7% in 2024 to reach KES8.4trn ($60.1bn), supported by an accelerated consumer shift towards digital payment methods.
“Fintech innovations such as ‘Mobile Money’ were long overdue in Africa. Kenya is not a singular case. With an increasing number of consumers and service providers adopting mobile technology worldwide, ‘Mobile Money’ is steadily becoming the next big thing in retail finance. It’s only a matter of time before it spreads to other regions. Online brokers have also started seeing the benefits of Mobile Money as a simple, quick and secure way to transact online. The underbanked can now access a whole range of services, including trading and investing, they could not even think about before. It’s a win-win”, said Terence Hove, Financial Markets Strategist Consultant at Exness.
GlobalData, publishers of EP notes the ease of setting up an M-PESA account, its simplicity of use and affordability, and the high penetration of mobile phones have all contributed to its strong growth. As of July 2024, M-PESA has more than 51 million customers, and over 604,000 active agents across Africa.
Follow us on Telegram, Twitter, and Facebook, or subscribe to our weekly newsletter to ensure you don’t miss out on any future updates. Send tips to editorial@techtrendsmedia.co.ke