steven maseka 
A Central Bank of Kenya (CBK) survey shows that diaspora remittances to Kenya reached a record $ 3,718 Million in 2021.
This surpassed a previous record of $ 3,094 Million in 2020, equivalent to 3% of Kenya’s Gross Domestic Product (GDP). However, only inflows through authorized channels such as authorized international remittance service providers in Kenya or commercial banks are included in the reported inflows. These exclude informal inflows and in-kind remittances.
According to the CBK Survey , which covers March to May 2021, the information gathered included efficiency and cost of alternative channels; difficulties in making cash or non-cash transfers; availability of information to Kenyans in the diaspora about investment opportunities in Kenya; and usage of cash received from abroad.
Remittance role in uplifting lives of Kenyans
“Diaspora cash inflows provide livelihoods to vulnerable households by contributing to basic needs such as food, education, healthcare and housing. In this context, there is need to better understand diaspora inflows and mainstream them into the country’s development process,” said Dr Patrick Njoroge, CBK Governor
The survey found that diaspora inflows were directed at family members, who are largely self-employed, unemployed or students.
About half of the total remitted was allocated to investment in real estate (land and buildings) for recipients; mortgage payment for senders and purchase of food and household items.
The survey also confirmed the importance of mobile cash operators and cash transfer companies in addition to banks as the main channels for cash remittances.
Kenyan diaspora prefer digital service providers due to convenience, promptness, and ease of access.
On average, recepients receive remittances on the same day, reflecting the efficiency of these channels.
Challenges identified in the survey include high cost of remitting cash and inadequate information on investment opportunities in Kenya for the remitters.
This Survey targeted Kenyans living abroad who had sent remittances in 2019. Respondents were reached with support from the Ministry of Foreign Affairs and Kenyan missions abroad, diaspora organizations and other stakeholders.
The Survey was conducted through an online questionnaire and attracted 1,321 respondents. The Survey indicated that Kenyans in diaspora left the country mainly in search of jobs and pursuit of higher education.
Across the regions, the Survey finds that the respondents left for Europe, North America and Oceania in pursuit of higher education while those in Asia and African countries mainly left in search of employment .
Oceania had the largest proportion of those who left the country due to family migration while Europe hosts the largest proportion of those who left due to marriage.
The main challenges of sending cash to recipients to Kenya, according to the Survey, include high cost of transfers, unfavorable exchange rates applied by service providers leading to high conversion costs, limits on amounts that can be remitted through mobile money operators; limited interoperability of mobile money systems and slow interbank transfers.
