Kenyans living abroad have become a vital economic pillar for the country, with diaspora remittances now playing a transformative role in shaping Kenya’s financial stability and growth. The Central Bank of Kenya (CBK) and the government have acknowledged this growing influence, initiating discussions on how to harness these funds for national development.
In the first nine months of 2024 alone, Kenyans in the diaspora sent home approximately Sh469.4 billion a 17.2% increase from the same period in 2023. September 2024 alone saw inflows of Sh53.99 billion, and CBK projects the year’s total to reach $4.69 billion (Sh605 billion), marking the fastest annual growth since 2021.
Remittances now contribute between 3 and 4 percent of Kenya’s Gross Domestic Product (GDP), surpassing traditional exports like tea, coffee, and horticulture in foreign exchange earnings. For context, in 2022, diaspora remittances stood at $4.027 billion compared to $5.77 billion from exports, underlining their growing impact.
These funds do more than bolster macroeconomic indicators they provide lifelines to millions of Kenyan households. Diaspora money supports healthcare, education, housing, and daily expenses, promoting financial inclusion and helping alleviate poverty across the country.
The United States remains the largest source of these remittances, accounting for over 55% of total inflows in 2024. Several factors explain this dominance: the U.S. hosts a significant portion of the estimated 3 million Kenyans abroad, offering better economic opportunities and higher incomes. Furthermore, U.S.-based Kenyans benefit from access to formal financial services, allowing for secure, efficient, and cost-effective transfers.
The outlook for 2025 remains bullish, with monthly remittances frequently exceeding $400 million. May 2025 alone recorded $440.08 million, the second-largest monthly inflow ever. If this momentum continues, remittances could surpass the $5 billion mark in 2025.
As Kenya grapples with foreign exchange pressures and seeks inclusive growth strategies, diaspora remittances stand out as a stable, reliable, and impactful resource. With deliberate policy support, these inflows can be further leveraged for national development, infrastructure investment, and long-term economic resilience.
