The Central Bank of Kenya (CBK) is making a power play to reshape the country’s fintech landscape. Its newly released draft policy, which proposes cutting mobile money transaction fees by up to half, is a strategic move designed to stimulate intense market competition and fuel the next wave of financial innovation.
By significantly lowering the cost of transactions on major platforms like M-Pesa and Airtel Money, the CBK is effectively lowering the barriers to entry and use. This forces service providers to compete more on innovation, customer service, and value-added services rather than relying on high-margin transactional revenue. This policy could catalyze the development of new, affordable micro-investment and savings products built on top of these payment rails.
This intervention signals the CBK’s commitment to a more dynamic and consumer-centric digital finance ecosystem. It’s a bold step that acknowledges mobile money not just as a service, but as critical national infrastructure. This move is poised to accelerate the integration of digital payments into every facet of the Kenyan economy, fostering an environment where the next groundbreaking fintech solution can thrive.
