Diaspora remittances to Kenya rise by Sh15 billion in nine months

Kenyans working and living overseas wired home a total of Sh488.5 billion in the first nine months to September, a Sh15 billion increase compared to the same period last year.

Data from the Central Bank of Kenya (CBK) shows that remittance inflows grew to $3.774 billion (Sh488.5 billion) between January and September 2025, up from $3.658 billion (Sh473.5 billion) in a similar period in 2024, representing a 3.2 per cent increase.

In September alone, Kenyans in the diaspora sent $419.6 million (Sh54.3 billion), adding to the cumulative $3.355 billion (Sh434.2 billion) remitted in the first eight months of the year.

“Remittance inflows to Kenya totalled $419.6 million in September 2025. They remain a key source of foreign exchange earnings and continue to support the balance of payments,” the CBK said in its weekly bulletin.

Despite the growth, the 3.2 per cent rise was slower compared to the 17.2 per cent jump recorded in the same period last year. The slowdown coincided with the assumption of office by US President Donald Trump, whose administration introduced stringent anti-immigrant policies and threats of mass deportation.

The US, which remains the largest source of remittances to Kenya, has also enacted legislation imposing a 3.5 per cent excise tax on remittance transfers starting January next year. An analysis conducted by local media estimates that once implemented, the tax could extract about $131.46 million (Sh17 billion) from funds sent to Kenya.

Monthly inflows this year peaked in May, reaching $440.1 million (Sh56.96 billion), followed by January at $427.4 million (Sh55.3 billion) and August at $426.1 million (Sh55.1 billion). These spikes coincided with back-to-school periods, reflecting the role of diaspora remittances in financing education for family members in Kenya.

The CBK data highlights that while growth has slowed, diaspora remittances remain a vital contributor to Kenya’s foreign exchange earnings and balance of payments.

Looking ahead, the Bank projects that remittance inflows will hit a record $5.24 billion (Sh678.7 billion) in 2025 and rise further to $5.56 billion (Sh720.1 billion) in 2026. The country’s current account deficit is expected at 1.7 per cent of GDP in 2025 and 1.8 per cent in 2026, largely due to growing imports despite resilient exports and diaspora inflows.

The deficit is expected to be more than fully financed by financial account inflows, resulting in an overall balance of payments surplus of $674 million (Sh87.3 billion) in 2025 and $229 million (Sh29.7 billion) in 2026.

“This is expected to result in a foreign exchange reserves build-up, with gross reserves projected at $10,765 million (Sh1.39 trillion) in 2025 and $10,994 million (Sh1.42 trillion) in 2026, from $10,091 million (Sh1.31 trillion) in 2024,” CBK noted.

Foreign exchange reserves had surged to $12,072 million (Sh1.56 trillion) as of October 15, 2025, equivalent to 5.3 months of import cover, exceeding the CBK’s statutory requirement of four months.

Stable remittances have helped make funds sent by Kenyans abroad the country’s largest source of foreign exchange, with inflows reaching a record Sh666.7 billion in 2024, surpassing the previous high of Sh586.0 billion.

In August 2025, CBK, in collaboration with the Kenya National Bureau of Statistics (KNBS) and Financial Sector Deepening Kenya (FSD Kenya), launched the first-ever Remittances Household Survey (RHS) to collect comprehensive data on international remittance flows.

“Remittances are support received by households in Kenya from households outside Kenya. The support may be in cash or in-kind, without requiring the recipient to provide a corresponding economic item,” CBK said.

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They also include funds sent by Kenyan households to non-resident households abroad.

Data for international remittances are collected via authorised service providers, including commercial banks, money transfer operators, and mobile network operators.

“With remittance transactions growing in importance, accurate and comprehensive data must be collected on remittance flows,” CBK said.

“The 2025 RHS represents a major step towards improved data on remittances and will collect valuable information on amounts, uses, costs, and challenges to inform policy formulation, including measures to support remittance flows.”