The political anxiety in Kenya during the election period affected the mobile money market which experienced a decline in cash transactions in the July-August period.
Kenya's political stalemate is negatively affecting the mobile money market
Cash transactions declined during the electioneering period due to reduced business activity in the wake of the ongoing political uncertainty.
According to the Central Bank of Kenya (CBK), cash transacted through mobile money channels dropped by 7.3% to Kshs 286.3 bn in August from Kshs 308.9 bn in July due to reduced business activity in the wake of the political uncertainty.
The drop was also attributed to the decline in lending to the private sector as indicated by slow private sector credit growth of 1.6% as at August 2017.
This despite the fact that mobile money payments are increasingly being adopted by individuals and firms, with the latest data by Communications Authority of Kenya (CA) showing that mobile money subscriptions currently stand at 28.1 mn. The value of transactions on the other hand hit Kshs 1.2 tn for the quarter ended June 2017.
Mobile money platforms include Safaricom’s M-Pesa, Airtel Money, Telkom Money, Equity Group’s Equitel, Tangaza and MobiKash. With the rapid population growth of 2.6%, the mobile penetration rate at 88.7% and technological advancements, mobile payments are expected to increase as more firms adopt the convenient medium of money transfer.
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