Kenyan diaspora remittances up 47pc in May

Kenyans in the diaspora sent home Sh8.3 billion ($101 million) in the month of May, representing a 47 per cent increase compared to the same month in 2011.

The inflows were also 5.6 per cent higher compared to the previous month. The central bank cited lower money transfer costs and increased data collection as key factors for the increase.

The increased remittances are also informed by declining economic prospects in the developed markets that has made Kenyans to increase investments at home.

For instance yields on short term debt in Kenya earns up to 10 per cent currently compared to about 2 per cent in the developed markets.

The cost of money transfer has also gone down in the last one year on stiff competition after the World Bank launched a price comparison platform last year targeting to reduce the high prices.

Remittances are one of the main sources of foreign exchange for East Africa’s biggest economy alongside tea, horticulture and tourism.