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Mobile money is now the most used financial service in Kenya, says report

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By TF News Reporter

Mobile money remains is the leading mode of financial services commanding 75.6 of all points of service provided by financial institutions.CBK governor Prof Njuguna Ndung'u says 25 per cent of Kenyans have no access to financial servicesCBK governor Prof Njuguna Ndung'u says 25 per cent of Kenyans have no access to financial services

Though relatively new in the market, mobile money is far ahead of the traditional banking that commands a mere two per cent of the points. The newly introduced bank agents have increased significantly to command 12.3 per cent.

A mapping report released Thursday shows the country had 49,417 mobile money service financial touch points that represented 75.6 per cent of all points, followed by bank agents that had 8,083 points representing 12.3 per cent.

Commercial banks, postbank and mortgage finance institutions had 1,313 points that represents a mere two per cent. Insurance service providers and savings and Credit Co-operative society had 878 and 706 points respectively.

A finAccess GIS mapping of all financial access points shows that Nairobi and Mombasa have the highest number of Kenyans accessing banking services within a three kilometer radius while Wajir at 16.7 comes last.

Highlights

58 per cent of Kenyans living within a three kilometer radius have access to a financial access point

Financial services touch points tend to be located in economically active regions, more in urban than in rural areas

23.6 million Kenyans live within a three kilometer radius of mobile phone money agent compared to 8.5 million living near a bank branch.

The mapping revealed that the concentration of the points is located in areas that have high population density and also economic activities with the regions with least economic activities coming last.

Among the counties with the highest number of people accessing a touch point within a three kilometer radius include Kirinyaga (98 per cent), Kiambu (93.7), Nyamira (90.1) and Murang’a (89.2 per cent).

All the counties with least points are semi-arid with livestock farming as the main economic activities. These include Samburu (17.6 per cent), Tana River (18.2) Mandera (23.1) and Turkana (23.3 per cent).

“This mapping affords us more in-depth knowledge on how to address the challenges we face in expanding financial inclusion and ensures that the majority of our populace access and use affordable, appropriate and sustainable financial services, “says Central Bank governor Prof Njuguna Ndung’u.

“We still have some ground to cover in expanding access to financial services, given that about 25 per cent of the population remains totally excluded.”

The mapping report says financial inclusion is linked to increased ability to overcome poverty, reduced disparities and increased economic growth.

It says the Kenyan financial inclusion landscape has undergone considerable transformation as a result of improved infrastructural facilities, technological innovation, institutional developments as well as financial system policy and regulatory reforms.

“The proportion of adult population using different forms of formal financial services stood at 66.7 per cent in 2013, up from 41.3 per cent in 2009,” it says.

“Similarly, the proportion of adult population totally excluded from financial services has declined to 25.4 per cent in 2013, from 31.4 per cent in 2009.”

The mapping also shows that Kenya is ahead of many other African countries in the provision of financial services. Kenya with 76.7 per cent of the population accessing financial services within five kilometers is ahead of Tanzania (35.1 per cent), Uganda (42.7) and Nigeria (47.3 per cent).

In the number of financial access points, Kenya comes top with 65,353, Tanzania (20,229), Uganda (21,206) and Nigeria (17,212). Kenya still has the highest number of access points per 100,000 people. That stands at 161.9, Tanzania (48.9), Uganda (63.1) and Nigeria (11.4).

 

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