CBK ends free charges on transactions between mobile money wallets, bank accounts
Central Bank of Kenya head office in Nairobi.
The Central Bank of Kenya (CBK) has reintroduced charges for transactions between mobile money wallets and bank accounts.
The CBK had waived the charges in March 2020 as part of emergency measures that were put in place by the government to facilitate the use of mobile money to prevent the spread of the Covid-19 disease.
The CBK however says the new charges will be lower than the previous charges that were applied before the waiver.
The charges will take effect on January 1 next year.
The CBK said maximum charges for transfers from bank accounts to mobile money wallets will be reduced by up to 61 per cent and mobile money wallet to bank account by up to 47 per cent.
Further, tariffs for paybills that are used to collect and disburse funds by businesses, companies, and institutions such as schools and utilities will be cut by some 50 per cent.
Banks have also cut the charges levied on money transfers to mobile money wallets by up to 45 per cent.
“The revised charges for bank to wallet and wallet to bank transactions will be announced by respective PSPs and banks and will be effective from January 1, 2023,” said the CBK.
The CBK said the waiver had achieved its target of growing the use of mobile money as well as protecting users from high transaction charges.
“While Covid-19 adversely impacted people’s livelihoods and businesses, mitigation measures enabled the payments ecosystem to protect vulnerable Kenyans, support businesses, and strengthen economic resilience. As a result, the payments ecosystem expanded significantly,” said CBK.
The apex bank said the number of Kenyans actively using mobile money increased by over 6.2 million, while the monthly volume and value of person-to-person transactions increased from 162 million transactions worth Sh234 billion, to 440 million transactions worth Sh399 billion.
Further, the monthly volume and value of transactions between payment service providers (PSPs) and banks increased from 18 million transactions worth about Sh157 billion, to over 113 million transactions worth Sh800 billion.
“This outcome confirms that the mitigation measures were timely and effective, and resulted in significant benefits across the financial system. The resumption of revised charges is aimed at building on these gains, facilitate a transition towards sustainable growth of the mobile money ecosystem, and ensuring affordability of payment services for Kenyans,” said thee CBK.
