Diaspora remittances jump to Sh210 billion in four months

Money sent home by Kenyans living and working abroad grew 23.1 percent during the first four months of this year.

Photo credit: Fotosearch

Money sent home by Kenyans living and working abroad grew 23.1 percent during the first four months of this year to hit $1.6 billion (Sh210.4 billion) compared to the $1.3 billion (Sh170 billion at current exchange rates), buoyed by easing inflationary pressures in developed economies.

Latest data from the Central Bank of Kenya (CBK) indicates that Kenyans living in diaspora remitted $397.3 million (Sh52.2 billion) in April to add onto the cumulative $1.2 billion (Sh157.8 billion) sent home during the first quarter of the year, with last month’s inflows being the least during the review period.

January recorded the highest amount so far this year at $412.4 million (Sh54.2 billion) followed by March which posted $407.8 million (Sh53.6 billion) while February came third at $385.9 million (Sh50.7 billion).

The combined amount sent back to Kenya between January and April 2024 translates to a $267.5 million (Sh35.2 billion) increase from the inflows that were wired into the country during the first four months of last year.

Increased dollar inflows from Kenyans abroad have partly helped ease pressure on the shilling this year by supporting the supply side of the dollar against demand by importers shipping in goods.

Last month, the US retained its position as the largest source of remittances to Kenya, accounting for 49 percent of the total remitted value which was a drop from its 56 percent contribution in March.

During the three-month period to last March, the United Kingdom (UK) overtook Saudi Arabia to become the fastest-growing source of diaspora dollar flows into Kenya.

Other top sources of remittances include Germany, Australia, the United Arab Emirates, Tanzania as well as Canada.

The improvement of overall remittances’ performance follows the cooling off of the Russia-Ukraine conflict which had disrupted global supply chains, sending global inflation to decades-high levels.

Sky-high energy, food and rent prices due to the supply disruptions following Russia’s invasion of Ukraine in February 2022 had pushed up living costs in the US and Europe, eating into the disposable income that Kenyans in those economies tap to assist families and dependents back home.

Since 2015, remittances from abroad have remained the largest source of foreign cash flows into Kenya ahead of tourism, foreign direct investments and the export of agricultural products such as tea and coffee.

A CBK-commissioned Kenya Diaspora Remittances Survey Report of December 2021 showed that the largest share of the inflows goes into supporting families at home to buy food and household goods as well as pay medical bills and school fees.

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