Economy

Mobile phone cash deals hit decade high with Sh1trn rise

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A mobile phone user makes an M-Pesa transaction. FILE PHOTO | NMG

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Summary

  • Cash transactions through mobile phones jumped by more than Sh1 trillion in the six months to June, a decade-high growth that indicates recovery from Covid-19 economic fallout.
  • Central Bank of Kenya (CBK) data shows M-Pesa, Airtel Money and Telkom’s T-Cash agents handled Sh3.26 trillion, a 52 percent rise from Sh2.14 trillion in a similar period last year when Kenya was hit hard by the Covid-19 pandemic.
  • The record value of mobile phone cash transactions reflects the continued economic recovery after the curbs that followed the pandemic shed jobs and led to business closure.

Cash transactions through mobile phones jumped by more than Sh1 trillion in the six months to June, a decade-high growth that indicates recovery from Covid-19 economic fallout.

Central Bank of Kenya (CBK) data shows M-Pesa, Airtel Money and Telkom’s T-Cash agents handled Sh3.26 trillion, a 52 percent rise from Sh2.14 trillion in a similar period last year when Kenya was hit hard by the Covid-19 pandemic.

The record value of mobile phone cash transactions reflects the continued economic recovery after the curbs that followed the pandemic shed jobs and led to business closure.

The easing of the restrictions and the rollout of the Covid-19 vaccines has upped economic activity, reversed pay cuts and a gradual return to hiring.

“Indicators for the Kenyan economy point to a relatively strong GDP (gross domestic product) recovery in the first half of 2021, mainly supported by strong performance of construction, information and communication, education, and real estate sectors,” CBK governor Patrick Njoroge said last Wednesday.

The economic recovery started in the fourth quarter of last year, supported by agriculture, real estate and the financial sectors, months after Kenya eased the Covid-19 restrictions through phased re-opening of various sectors.

The restrictions, which the State imposed in March last year, included a ban of movement into and out of four counties, including Nairobi and Mombasa, suspension of international and domestic flights, closure of bars and eateries and a dusk to dawn curfew that cut operating hours for businesses and hit their sales.

However, the easing of the restrictions that started in July last year and the rollout of the Covid-19 vaccines has since boosted economic recovery with firms scaling up operations, hiring more staff and reversing pay cuts initiated last year at the peak of Covid-19.

The International Monetary Fund also projects Kenya economy’s real GDP growth will jump to 7.6 percent this year, up from a 0.1 percent contraction in 2020.