The Kenyan banking industry has reportedly lost around $11 million in revenue from card payments to telco mobile platforms in the last nine months

With the coronavirus pandemic still ongoing, bringing with it a host of economic struggles, Kenya’s banks are feeling the strain. But this is not just a matter of fewer transactions taking place during this difficult period, but also the medium through which these transactions are being made.

The latest data from the Central Bank suggest that, in the period between March and November 2020, $11.55 million worth of card payment revenue was lost, with customers instead turning to mobile money payment platforms for their transactional needs. 

By November 2020, card payments had fallen by 8%, meanwhile mobile money transactions were skyrocketing, increasing by 44.5% in the same period. 

Perhaps the main culprit here is Safaricom’s M-Pesa, who already boasted around 20.5 million Kenyan users at the start of the pandemic. Furthermore, in an effort to help limit the spread of diseased via physical transactions, at the start of the pandemic M-Pesa announced that all person-to-person transactions below 1,000 Kenyan Schillings (~$10) could now be made free of charge.

The government too sought to encourage such safety measures, with the Central Bank of Kenya itself further facilitating the use of the mobile money platforms during this time by scrapping the charges normally applied to transfer money back and forth from a customer’s bank account to their mobile money wallet. Similarly, the Kenyan regulator increased mobile money transaction limits, almost doubling both the individual transfer limit and the cap on daily transactions.

But, while many of these steps would not have been taken without the advent of the coronavirus pandemic, it is important to note that mobile money platforms were already growing in popularity before the Covid crisis hit in earnest. 

“This period (Covid-19) was more a secondary catalyst than the core driver of lower earnings,” Daniel Kuyoh, a Nairobi-based financial analyst, explained to The East African.

Now, with the coronavirus resurging around the world, Kenya has tightened its pandemic restrictions once again, extending its current evening curfew until March, alongside other health precautions. For the banks, the chances of an immediate bounce back in revenue in 2021 seem slim, while the mobile money platforms will presumably continue to grow their already significant market share. 


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