National Economic Survey 2024 found that there was a decrease of 600,000 mobile money subscribers in the country last year (2023).

According to the National Economic Survey, the total number of mobile money subscribers dropped from 38.6 million to 38 million in 2023.

However, there was a 5.5 percent increase in the cash transferred, reaching a total of KSh5.5 trillion. This indicates a change in consumer behavior and usage patterns when it comes to mobile funds services.

“Mobile money transferred between subscribers however, increased by 19.6% to 5.5 trillion in 2023,” KNBS said in the survey.

Kenya additionally experienced slower growth in mobile money subscriptions since 2007, especially after the government increased tax on transaction fees.

Kenya being a leading mobile money economy, with providers like M-Pesa, Airtel Money, and Telkom Cash, there has been a further drop in mobile money subscriptions due to new taxes proposed by the Treasury.

The government aims to raise an additional $2.5 billion(KSh 323billion) in taxes through the 2024 Finance Bill. The excise duty on mobile airtime and data rates has been increased to 20 percent from 15 percent.

This might have impact on the cost of mobile services and financial transactions.

“As of 30th December 2023, mobile money subscriptions dropped to stand at 38 million, translating to a penetration rate of 7.51 percent. The decline is attributed to the drop in number of mobile (SIM) subscriptions,” reads a recent report by the Communications Authority (CA).

Communications Authority further revealed that the mobile money penetration rate in Kenya started at 78.2 percent in December 2022 but gradually dropped over the year, stabilizing at around 75.1 percent from June 2023.

CA also mentioned that prepaid plans still dominate the market, with 65,492,294 out of the total 66,754,709 subscriptions leaving only a small fraction of 1,253,415 for postpaid plans.

Safaricom’s number of subscriptions remained impressive with 44,013,156 total subscribers. 42,875,208 being prepaid and 1,137,948 being postpaid.

Airtel the second-largest network service provider, follows a similar trend with 19,282,993 prepaid subscriptions and only 104,467 postpaid.