Inside plan to cap mobile money charges: Timelines and what it means for Kenyans

Kenyans could soon pay less for mobile money transactions after the government proposed to cap mobile money transaction fees in the draft National Financial Inclusion Strategy (NFIS) 2025–2028.

The draft strategy, launched jointly by the Central Bank of Kenya (CBK) and the National Treasury, identifies high transaction costs as one of the major barriers preventing many citizens, particularly women, youth, and rural populations, from fully utilising digital financial services.

High access, low usage

Kenya remains a global leader in mobile money adoption, with over 82% of adults actively using platforms like M-PESA.

But officials admit the success story is starting to plateau. Most users stick to basic person-to-person transfers, while the adoption of savings, insurance, and credit products remains limited.

The draft NFIS report attributes this to mistrust, high fees, and a lack of tailored products. 

For example, while millions send money daily, fewer than four in ten Kenyans regularly save with formal financial institutions.

Proposal to enforce fee caps

To address the challenge, the new strategy explicitly proposes that CBK, telcos, and Parliament “enforce P2P fee caps” between 2025 and 2027. 

This would bring down the average cost per mobile transaction from around Sh23 to about Sh10.

The move builds on past reforms, such as the cap on M-Pesa merchant service fees introduced years earlier. 

That policy limited charges to 0.55% of the transaction value, with a maximum of Sh 200, a change credited with boosting merchant adoption and usage.

During the Covid-19 pandemic, CBK also instructed mobile money providers to waive fees for mobile money transactions below Sh1,000.

Between October and December 2020, the value of M-Pesa transactions increased by 97%.

CBK later recorded major jumps across different services over nearly two years. 

Person-to-person transfers increased 35% in volume and 84% in value.

Pay bill transactions increased by 143% in volume 344% in value. 

Till numbers (merchant payments) increased by 263% in volume, +136% in value, while mobile money to bank accounts transactions increased by 573% in volume,  and 849% in value. 

The draft strategy concludes that these fee waivers and adjustments showed how pricing reforms can rapidly expand financial inclusion, especially for low-income users.

What it means for Kenyans

If implemented, the new caps could dramatically reduce the cost of sending money, paying bills, and accessing other financial services through mobile wallets. 

This would be especially significant for low-income households that depend heavily on mobile money for daily transactions.

The NFIS 2025–2028 goes beyond mobile money fees. 

It sets out six pillars, including expanding rural agricultural finance, developing green finance, and improving access for vulnerable groups like women, persons with disabilities, and forcibly displaced persons.

But for ordinary Kenyans, the prospect of cheaper mobile money services is likely to be the most immediate and impactful reform.

If the country adopts the proposal, mobile money operators will have to comply with new fee caps by 2027, potentially reshaping Kenya’s digital payments landscape yet again.