CBK Moves to Cap Fees on M-Pesa, Airtel Money Transfers

By Esther Murigi,

The Central Bank of Kenya (CBK) is preparing new rules to cap charges on mobile money transfers across networks in a bid to reduce costs for consumers and boost competition in the fast-growing digital payments sector.

CBK Governor Kamau Thugge said the regulator is finalizing a pricing plan that will set ceilings on fees charged by operators such as Safaricom’s M-Pesa and Airtel Money.

Mobile money has become the backbone of financial transactions in Kenya, with M-Pesa controlling more than 90 percent of the market. But consumers have long complained about what they see as excessive fees, especially for cross-network transfers.

Sending KSh500 from one M-Pesa account to another costs about KSh12, while withdrawing the same amount at an agent costs roughly KSh27. Transfers across networks, such as from M-Pesa to Airtel Money, attract even higher fees, discouraging interoperability.

CBK says such costs hurt consumers and weaken smaller competitors like Airtel Money and Telkom’s T-Kash.

The regulator pointed to the Covid-19 period in 2020, when it directed operators to abandon fees on transactions below KSh1,000. The waiver triggered a sharp rise in digital payments and small-value transfers. Once the waivers were lifted, however, many users reverted to cash due to high charges. CBK says this proved that Kenyans are willing to embrace cashless transactions if costs are kept low.

If carried out, the new rules will make sending money across different networks cheaper and easier, leveling the playing field between operators. Analysts say the changes will largely benefit low-income Kenyans, who conduct frequent small-value transactions and bear the brunt of the fees.

For Safaricom, the move could hit revenues from M-Pesa, which is its largest profit driver. CBK, however, said the framework will ensure operators can still recover costs and invest in innovation while protecting consumers from excessive charges. Airtel Money and T-Kash are expected to gain from lower cross-network fees, which could attract new users and challenge Safaricom’s control.

Dr. Thugge said that CBK has circulated a draft of the proposed pricing rules to mobile operators, banks, and consumer groups for input. The final guidelines are expected in the coming months and could take effect next year. He also added that Financial inclusion is not just about access, but also about affordability and fairness.

Kenya is seen leading in mobile money innovation, with the launch of M-Pesa in 2007 opening financial services to millions without bank accounts. Today, mobile money accounts outnumber bank accounts, and transactions running into trillions of shillings flow through digital wallets every year. The new rules, CBK says, are the next step in deepening financial inclusion and ensuring the benefits of mobile money reach all Kenyans.

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The Author is Esther Murigi certified Broadcast Journalist