A new report has revealed that Kenyan households received a total of Sh931.8 billion in remittance inflows between June 2024 and May 2025, highlighting the continued importance of diaspora transfers to the country’s economy.
According to the 2025 Remittances Household Survey Report, cash transfers accounted for 91.0 per cent of total inflows, while in-kind remittances made up the remaining 9 per cent.
The report shows that the United States of America remained the largest source of remittances, contributing 43.5 per cent of the total inflows, followed by Germany and Australia. It further notes that formal channels remain the preferred mode of transfer, with banks and mobile money platforms accounting for more than 92.0 per cent of remittances received.
The fastest remittance corridors were the United States, Saudi Arabia, and Qatar, where most transfers were received on the same day.
While cash transfers dominate, the report highlights that in-kind remittances continue to play a significant role, particularly among households with lower levels of education and those living in rural areas.
“Households in Kenya sent a total of Sh40.5 billion in remittances during the reference period, with cash transfers accounting for 89.5 per cent of total outflows,” the report states.
These outward flows were largely directed towards students abroad, who accounted for more than two-thirds of total remittances sent, underscoring education as a key driver of cross-border financial support from Kenyan households.
The report notes that remittances primarily support tuition fees, living expenses, and settlement costs for Kenyans studying overseas, positioning them as an investment in human capital with long-term economic benefits.
Remittances are defined as personal transfers made by resident households to non-resident households in cash or kind, without receiving any direct return. They are not linked to income sources or conditional on specific use, and are considered a key source of household welfare support and foreign exchange earnings.
The survey further shows a clear rural-urban divide in remittance patterns, with rural households forming the majority of both recipients and senders. Education levels also influence the form of remittances received, with urban and more educated households mainly receiving cash transfers, while rural and less educated households rely more on in-kind support.
Return migration was largely driven by family reunification and the expiry of work contracts, reflecting broader migration and financial flow dynamics.
A strong link was also observed between financial inclusion and remittance receipt, with 82.5 per cent of recipients owning mobile money accounts and 55.4 per cent holding bank accounts.
However, uptake of investment-oriented financial products remains low, with only 6.5 per cent owning securities, 5.4 per cent holding microfinance accounts, and 1.6 per cent holding cryptocurrency accounts.
The report shows mixed trends in remittance flows, with 29.9 per cent of households reporting increased receipts compared to the previous year, while 10.3 per cent recorded declines. Growth was mainly driven by improved employment opportunities and higher incomes, while economic uncertainty and financial pressures contributed to reduced inflows.
Overall, the survey confirms that remittances play a critical role in supporting household livelihoods, with 42.3 per cent of households relying on them as a supplementary source of income, 36.4 per cent as additional income, and 22.3 per cent as their main source of livelihood.
The findings underscore the need for policies that reduce transfer costs, expand access to formal channels, and promote productive use of remittances in education, health, and sustainable investments, while strengthening diaspora engagement in national development.
Globally, remittance flows to low- and middle-income countries were estimated at $685 billion in 2024, growing by 0.7 per cent and outperforming foreign direct investment, which recorded a decline, and official development assistance, which saw modest growth.
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