By Adedapo Adesanya
Kenya has continued to maintain its position as Africa’s most remarkable mobile money market as the use of the service hit a historic high in 2021 after users transacted 6.24 trillion shillings (equivalent to $55.1 billion) on phones between January and November in 2021.
This indicated a 20 per cent increase from the previous year, surpassing the $45.9 billion transacted in the entire 2020, the Central Bank of Kenya (CBK) said in a new data released on Monday.
The surge in transactions came despite the government removing COVID-19 subsidies at the start of 2021.
The Kenyan government at the onset of the pandemic in the nation in March 2020 made all mobile money transactions worth $8.83 and below free as well as bank and mobile transactions.
This boosted usage and saw eight million subscribers join the service as cashless transactions increased, according to the CBK.
Upon removal of the subsidies, usage of the service was expected to decline or slow down but the opposite has happened, according to the East African country’s top lender.
It was observed that the highest ever mobile money transaction in a month was recorded in November at $5.5 billion as the number of agents hit a high of 299,053 and subscriptions at 67 million, said the CBK.
Kenya is regarded as the frontier of mobile money, starting the service as early as 2007 and this has transformed the everyday lives of most Kenyans, disrupting the traditional banking system and capturing the previously unbanked market and driving financial exclusion.
With ease brought about by the service, it allows for deposits and withdrawals of cash, bank account transfers, the payment of bills from electricity to school fees, loan and savings transactions, and the receipt of salaries.
A large proportion of the population is employed in cities, sending money home to families in rural areas. As a result, mobile money agents in cities mostly receive deposits of cash, whilst agents in rural areas mostly pay out withdrawals.
The reliability of the system rests heavily on active liquidity management; rural agents have an efficient system of replenishing their cash resources once these have been swapped out for mobile money via customer withdrawals.
Business Post Contributor 
Dipo Olowookere