By Nicholas Waitathu
Kenya: Remittances from Kenyans in the Diaspora increased by 16 per cent to Sh10.2 billion ($119.6 million) in March compared to Sh8.8 billion the same period last year.
Data released by the Central Bank of Kenya (CBK) Wednesday indicates the 12 month cumulative remittance inflows also increased by 12.2 per cent from Sh101.4 billion ($1.18 billion) in March 2013 to Sh113.7 billion ($1.3 billion) in March 2014.
“The 12 month cumulative average remittance flows have sustained an upward trend reaching Sh9.4 billion ($110.3 million) from an average of Sh8.4 billion ($98.3 million) in March 2013,” states the CBK remittance report.
In the review period CBK states that remittance inflows by source market remittances remained resilient, with North America Accounting for 51.4 per cent of total inflows accounting to Sh5.2 billion ($61.42 million) in March 2014.
Inflows from Europe accounted for 25 per cent and amounted to Sh2.5 billion ($29.95 million), while inflows from the rest of the world amounted to Sh2.4 billion ($28.22 million), with a share of 23.6 per cent. Diaspora remittances, along with tourism, tea and horticulture are among Kenya’s leading foreign exchange earners.
Most of the money sent by Kenyans in the Diaspora is now being used to fund investment projects, a move that has attracted local companies, especially in the banking sector. World Bank estimates Kenyans in the Diaspora to be approximately 500,000.
Local banks like Kenya Commercial Bank, Equity, Chase and Cooperative banks already offer their banking services to the diaspora community. Huge percentage of the remittances are invested in the property market and in Nairobi Securities Exchange (NSE).
Diaspora remittances have maintained an upward trend in the country over the recent past thus contributing significantly to the country’s foreign exchange inflows.
However, concerns over remittances made through informal channels have arisen due to the global challenges of money laundering and terrorism financing. Central Bank of Kenya Act was amended in October 2012 to make provision for the licensing and supervision of stand-alone money remittance provider
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