(Nairobi) – Remittance inflows from Kenyans living and working abroad dropped by Sh1.25 billion in September 2024, compared to the previous month. The data from the Central Bank of Kenya (CBK) shows that total remittances for September amounted to $418.5 million (Sh54.065 billion), down 2% from the record high of $427.2 million (Sh55.19 billion) sent in August.
Despite the decline, the September inflows represent a notable increase of 22.9% compared to the same period in 2023 when remittances were $340.4 million (Sh44 billion). The August figures were an all-time monthly high, largely driven by easing inflation in the United States, which is Kenya’s largest source of remittances.
The cumulative inflows for the 12 months leading up to September 2024 reached $4.723 billion (Sh610.2 billion), an increase of 14% from the previous year, when the total was $4.142 billion (Sh535.1 billion). The United States remains the largest contributor to Kenya’s remittance inflows, accounting for 55.4% of the total in September 2024.
These remittance inflows play a significant role in supporting Kenya’s economy, particularly the current account and the foreign exchange market. According to CBK, the country’s usable foreign exchange reserves stood at $8.485 billion (Sh1.1 trillion) as of October 24, 2024. This is enough to cover about 4.4 months of imports, meeting the CBK’s statutory requirement for import cover.
Kenya continues to be one of the top recipients of remittances in Africa, with a large portion of these funds being directed toward household needs, healthcare, and education. In recent years, Kenyans in the diaspora have also increased their investments in the capital market and real estate, particularly in the US, Canada, and the UK.
The remittances have been crucial in stabilizing the Kenyan shilling, which had faced significant pressure earlier in the year. In January 2024, the shilling reached a record low of Sh161 to the dollar, as the country struggled with a dollar shortage. However, in the past month, the Kenyan shilling has remained stable against the US dollar, trading at an average of Sh129.19 according to CBK data.