Kenyans living abroad are channelling an estimated Sh280 billion into the country each year through informal and non-monetary means, significantly increasing the scale of diaspora support to households beyond what official banking data captures.
A new nationwide survey indicates that total diaspora remittances reached Sh931.8 billion in the 12 months to May 2025. The figure includes both formal transfers and informal inflows, such as cash carried by individuals and goods sent through non-banking channels.
The study found that informal inflows amounted to Sh280.6 billion, bridging the gap between the Central Bank of Kenya’s (CBK) formal remittance record of Sh651.2 billion and the broader estimate. It is the first comprehensive attempt to capture household-level remittance flows in the country.
The survey was conducted in August 2025 by the Kenya National Bureau of Statistics (KNBS), the Central Bank of Kenya and Financial Sector Deepening (FSD) Kenya, and covered 4,400 households.
Of the total inflows, Sh848.4 billion was received in cash, while Sh83.5 billion came in the form of goods and other in-kind transfers.
“The report has revealed the invisible 40 per cent of remittances that we did not see because they flowed through informal channels. This is the money quietly pressed into the palm of a cousin when you return home, or the phone that someone carries in their luggage for you,” said FSD Kenya chief executive officer Rashmi Pillai.
The findings show that many Kenyans abroad rely on informal channels such as personal delivery, Hawala systems and cryptocurrencies to avoid high transfer fees, delays and bureaucratic hurdles.
In-kind remittances are also significant, with about 30 per cent of migrants delivering goods personally or through travelling relatives. Those in neighbouring countries frequently use road transport networks, including buses and motorcycles, with 26.8 per cent relying on such methods because of their convenience and lower cost.
The report highlights the critical role remittances play in supporting household consumption, particularly at a time of rising living costs and stagnant wages. About 73.1 per cent of recipient households reported spending a large share of the funds on food and basic necessities.
Other major uses included education (31.4 per cent), healthcare (23.9 per cent), clothing (19.8 per cent), rent (9.3 per cent), and ceremonies such as weddings and funerals (8.8 per cent).
“A substantial share of remittances was directed towards basic consumption, particularly food, household goods and services, underscoring their importance in sustaining livelihoods,” the report states.
“Beyond consumption, the survey revealed that remittances also make a significant contribution to human capital development through spending on education and healthcare.”
The data further shows that 42.3 per cent of households rely on remittances as supplementary income, 36.4 per cent as additional income, while 22.3 per cent depend on them as their primary source of livelihood.
The United States remained the leading source of diaspora inflows, contributing Sh405.4 billion, or 43.5 per cent of the total. Germany followed with Sh85.98 billion, ahead of Australia (Sh62.6 billion) and Saudi Arabia (Sh49.2 billion).
The inclusion of informal flows has reshaped understanding of Kenya’s remittance landscape, revealing stronger contributions from countries such as Germany and Australia, where growing numbers of Kenyans are engaged in professional and skilled migration.
