Kenyans working abroad sent home $315 million (KSh 34 billion) in May, the highest amount of remittances ever sent into the country in a month and a 22.3% increase from $258.2 million sent in the same period a year ago.
The rise in remittances was supported by a sharp increase in funds from the US, the largest source of diaspora inflows into Kenya. In May this year, remittances from the US jumped by 25% from a year ago, to an all time high of $182.6 million (KSh19.7 billion), accounting for 57.8% of remittances into the country that month.
Other major sources of remittances into Kenya were the UK, Saudi Arabia, Germany and Qatar. Kenyans in the UK remitted $34.6 million while Kenyans in Saudi Arabia remitted $15 million in May 2021. Remittances from Germany and Qatar reached $10.6 million and $6.3 million respectively in the period under review. In Africa, Tanzania was the leading source of remittances into Kenya, remitting $4.1 million in May.
According to data released by the Central Bank of Kenya (CBK), Kenyans in the diaspora have increased remittances into the country in recent months even as remittances to other developing nations have declined due to the effects of the pandemic. In the 12 months to May 2021, cumulative inflows rose by 19.5% to $3.365 billion (KSh362.75 billion), compared to $2.816 billion sent in the same period in 2020.
Kenya relies heavily on diaspora remittances as a major source of foreign currency. Remittances also play a vital role in providing livelihood to low-income households in the country. Due to the central role of remittances in Kenya, the Central Bank of Kenya is working with the Kenya National Bureau of Statistics, the Ministry of Foreign Affairs, and Kenyans in the diaspora to ease the process of remitting funds and therefore boost the amount of diaspora remittances into the country.
During a meeting between CBK officials and representatives of Kenyans abroad, CBK Governor Dr Patrick Njoroge said, “Our target is to reduce the cost of transferring funds to Kenya to between two and three percent of the funds transferred in order to increase Diaspora remittances.”
