Remittances from Kenyans in the diaspora dipped to KSh 55.2 billion in January, 4% lower than the KSh 57.6 billion recorded in December 2024, but 3.6% higher than January 2024.
- The downtick was primarily driven by significant decreases in Africa (32%) and Europe (4%), while Asia and Australia recorded mild increases.
- The US remained the largest source of remittances to Kenya, accounting for 53.2% in January, although inflows saw a 1.6% slowdown to stand at KSh 29.4 billion.
- Owing to increased disposable incomes in developed economies and the evolved migration laws, Kenya saw remittances surge 18% in 2024 to hit an all time high of KSh 639.04 billion.
In the 12 months to January 2025, cumulative remittances increased by 16.6% to US$ 4.96 billion compared to US $4.25 billion in a similar period in 2023.
Saudi Arabia has maintained the second largest source of remittances to Kenya for months, after surpassing the UK in March 2024. The shift to the Gulf region directly reflects the evolving migration laws that have made it harder for Kenyans to move to European countries, while Gulf countries have become a favorable destination due to their burgeoning labor needs.
Remittances from Bahrain, Oman, Ivory Coast, the UAE and Bahamas increased the most in January with most decreases recorded in Iraq, South Sudan, India, Egypt and New Zealand.
In Africa, Tanzania surpassed Uganda to top the list with remittances amounting to US$7.0 million and US$5.4 million respectively with inflows from South Africa totalling US$1.3 million in January. The overall flow from African countries were dampened by significant dips in flows from South Sudan, Egypt, Malawi.
Since 2015, diaspora remittances have been the largest source of foreign inflows into the country, ahead of tourism, foreign direct investments, and key agricultural exports such as horticulture and tea. According to IFDR, Kenya is the third largest remittance recipient in sub-Saharan Africa and the fifth largest receiving country in Africa. In 2024, according to the Central Bank of Kenya, remittance flows totalled about US$4.95 billion, accounting for nearly 3.6% of the country’s GDP.
“The remittance inflows continue to support the current account and the foreign exchange market. The US remains the largest source of remittances to Kenya, accounting for 53.2 percent in January 2025,” CBK noted in its weekly bulletin.
While Africa contributes the fewest illegal immigrants in the US, Trump’s policies are likely to affect remittances to Africa which mainly support food, housing, education and healthcare.
