Kenyans living in the diaspora have become an integral part of Kenya’s economy.
Their remittances back home have not only caught the attention of the Central Bank of Kenya (CBK) but also the eye of the government with discussions underway on how to capitalise on them for the betterment of Kenya’s economy.
Remittances contribute between 3 and 4 per centkj of Kenya’s GDP, underscoring their importance not only as a source of foreign currency but also as a means of supporting family livelihoods.
These funds help cover essential expenses such as healthcare, education, housing, and daily necessities, thereby enhancing financial inclusion and poverty alleviation
The Kenyan diaspora sent home approximately about Sh469.4 billion in the first nine months of 2024, marking a 17.2 per cent increase compared to the same period in 2023.
In September 2024 alone, remittances amounted to Sh53.99 billion. CBK projects total remittances for 2024 to reach around $4.69 billion (Sh605 billion), up from $4.19 billion in 2023, which would be the fastest annual growth since 2021.
Diaspora remittances have become a major source of foreign exchange for Kenya, surpassing key exports like coffee, tea, and horticulture.
For example, in 2022, remittances were about $4.027 billion, close to the $5.77 billion earned from exports that year.
The United States remains the largest source of these remittances, accounting for over 55 per cent of the inflows in 2024.
The projected annual remittance flow from Kenyans abroad for 2025 is expected to continue growing, building on the record inflows of 2024.
While specific official projections for 2025 are not detailed in the search results, the trend shows strong and accelerating growth, with monthly remittances frequently exceeding $400 million, and May 2025 recording $440.08 million as the second-largest monthly inflow on record.
Given this momentum and historical growth rates, it is reasonable to expect that 2025 remittances could surpass the 2024 figure, potentially approaching or exceeding $5 billion.
The remittances remain a critical source of foreign exchange for Kenya, with the US accounting for about half of all inflows.
US-based Kenyans are the largest source of diaspora remittances to Kenya primarily because the majority of the estimated 3 million Kenyans living abroad reside in the United States. This large population base naturally results in a higher volume of money sent back home.
Economic opportunities and higher incomes in the US allow Kenyan immigrants to earn more and thus remit larger amounts compared to other regions.
The US-based Kenyan diaspora often has greater access to formal financial services and remittance channels, which facilitates efficient, reliable, and cost-effective money transfers.
This accessibility encourages frequent remittances and fosters trust in the transfer process.
