Money sent home by Kenyans living abroad is becoming increasingly important to the country’s economy, with new data showing diaspora remittances have grown into a major source of income for both households and the government.
A new survey by the Central Bank of Kenya (CBK) and the Kenya National Bureau of Statistics (KNBS) estimates that Kenya received Ksh 1.15 trillion in remittances between June 2024 and May 2025. The amount represents about 3.7 per cent of the country’s Gross Domestic Product (GDP), underscoring the growing economic influence of Kenyans living and working overseas.
The findings show that remittances are no longer simply money sent to support relatives back home. They have become a critical source of foreign exchange, helping Kenya maintain economic stability amid global uncertainties and fluctuating capital flows.
Speaking during the release of the survey, CBK Director of Economic Research Francis Mudida said diaspora remittances now play a much bigger role than many people realise.
“We are now seeing remittances as a pillar of macroeconomic stability. They are not only supporting households but also strengthening foreign exchange reserves and sustaining economic resilience,” Mudida said.
According to the survey, the Ksh 1.15 trillion received over the one year included both cash and non-cash support. While 91 per cent of the remittances came in cash, the remaining 9 per cent were in-kind transfers such as goods, equipment and other forms of assistance sent to families.
The inclusion of in-kind remittances in the survey provides a more comprehensive picture of the contribution made by Kenyans in the diaspora. For years, official statistics mainly focused on money transferred through formal channels, leaving out a significant portion of support sent in other forms.
The report identifies the United States as the leading source of remittances to Kenya, followed by the United Kingdom, Germany, Canada and Australia. Together, these countries account for nearly 80 per cent of all remittance inflows.
Dependence on relatives abroad
The survey also highlights the extent to which Kenyan families depend on money from relatives abroad. About 22 per cent of households receiving remittances rely on them as their main source of livelihood. Another 42 per cent use the funds as supplementary income, while 36 per cent consider them an additional source of earnings.
For many households, remittances help cover daily expenses such as food, rent, school fees and healthcare. Others use the funds to build homes, invest in businesses, purchase land or support farming activities.
The growing value of remittances has also elevated their importance in Kenya’s broader economic landscape. The survey notes that diaspora inflows now exceed both Foreign Direct Investment (FDI) and official development assistance. This means money sent by Kenyans abroad is bringing more foreign currency into the country than some traditional sources of external financing.
The report further shows that banks remain the most popular channel for receiving remittances, handling 43.7 per cent of transfers. Mobile money services account for 33 per cent, reflecting Kenya’s strong adoption of digital financial services. The rest is received through money transfer operators and informal channels.
However, the survey found that many recipients still face challenges when accessing funds. High transaction costs remain the biggest concern, with more than eight out of ten households citing transfer charges as a major obstacle. Other concerns include delays in receiving money, strict verification requirements, limited access to financial services and poor exchange rates.
Mudida said there is a need to lower remittance costs and encourage more people to use formal transfer channels. He also urged policymakers and financial institutions to create more opportunities for diaspora investors.
As diaspora inflows continue to grow, economists believe they will remain a key pillar of Kenya’s economy, supporting household welfare while providing a stable source of foreign exchange for the country.
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