Kenyans working abroad sent Sh5.8 billion less in remittances in February 2025 compared to January 2025.
The Central Bank of Kenya (CBK) data shows remittance inflows for February 2025 totalled $382.2 million (Sh49.5 billion), a 10.6 per cent decrease from January’s $427.4 million (Sh55.3 billion).
Compared to February 2024, when inflows totalled $385.9 million (Sh50 billion), this represents a one per cent decrease.
“The cumulative inflows for the 12 months to February 2025 increased by 14.5 per cent to $4,956 million (Sh641.8 billion) compared to $4,330 million (Sh560.7 billion) in the 12 months to February 2024,” the CBK stated in its weekly bulletin.
The United States remained the largest source of remittances to Kenya, accounting for 53 per cent of the total in February 2025.
The decline in February 2025 remittances may be attributed to the strengthening of the Kenyan shilling against the US dollar during that month.
The Kenyan shilling remained relatively stable against the US dollar for approximately seven months leading up to February 2025, averaging Sh129 per dollar. In February 2025, the average exchange rate was Sh129.30 per dollar.
This represents a Sh31 gain, or a 19 per cent strengthening, compared to the historic low of Sh160 per dollar.
While a stronger shilling benefits the Kenyan economy by reducing import costs and debt burdens, it negatively impacts remittance inflows.
A stronger shilling lowers import costs, potentially reducing consumer prices and lowering the cost of living. It also strengthens foreign exchange reserves as importers require fewer dollars.
Furthermore, a stronger shilling reduces the pressure of servicing dollar-denominated debt.
