Finance Bill 2024: Kenyans To Pay More For M-Pesa, Bank Money Transfer Services

• Finance Bill 2024 proposes to raise the excise duty rate on fees for money transfer services provided by banks, money transfer agencies, and other financial service providers
• The cost of airtime and data would also rise as the government seeks to raise an additional KSh 323 billion to finance the 2024/2025 financial year budget
• Safaricom and Airtel charge more to transfer money to banks than to withdraw money from banks to mobile wallets

TUKO.co.ke journalist Japhet Ruto brings over eight years of experience in financial, business, and technology reporting, offering deep insights into Kenyan and global economic trends.

If the proposal to increase the excise duty is passed by Members of Parliament (MPs), Kenyans will pay more for M-Pesa and bank money transfer services.

The Finance Bill 2024 proposes to raise the excise duty rate on fees for money transfer services provided by banks, money transfer agencies, and other financial service providers.

According to the suggestion, the rate would be increased from 15% to 20%.

The cost of airtime and data would also rise as the government seeks to raise an additional KSh 323 billion to finance the 2024/2025 financial year budget.

"The proposed excise duty rate is 20% and would apply to the following services: telephone and internet data services; fees charged for money transfer services by banks, money transfer agencies, and other financial service providers," the bill states.

What are the current charges for M-Pesa transactions?

In September 2023, Safaricom announced new charges for M-Pesa transactions of up to KSh 250,000.

The telecommunication firm increased the transaction limit to KSh 250,000 in compliance with Central Bank of Kenya (CBK) directives.

The company introduced a new transaction band of KSh 151,000 to KSh 250,000 for sending money, Lipa na M-Pesa, Buy Goods and Pay Bill.

Safaricom CEO Peter Ndegwa said the maximum fees would apply for the new transaction band, including KSh 108 for sending money.

Sending money below KSh 100 is free.

What are bank charges?

Safaricom and Airtel charge more to transfer money to banks than to withdraw money from banks to mobile wallets.

The maximum bank tariffs for sending KSh 20,000 to KSh 150,000 to mobile wallets are set at KSh 65 to KSh 81.

Safaricom charges between KSh 87 and KSh 105 for sending KSh 30,000 to KSh 150,000 to a bank account.

Proofreading by Otukho Jackson, a multimedia journalist and copy editor at TUKO.co.ke