Mobile money deposits for the year ending June 2012 rose by 38 per cent to exceed the half a trillion shilling mark, revealing just why the government can no longer resist the temptation to tax the sector.
According to data released by the Communications Commission of Kenya (CCK) on Tuesday, Kenyans deposited Sh672.3 billion into mobile money services, up from Sh486 billion in year ending June 2011.
The number of mobile money agents rose by 15.99 per cent to hit 49,079 while the number of mobile money subscriptions rose by 12.13 per cent to 19.5 million.
â€œThis upward trend signifies that mobile money transfer service has become instrumental in providing the unmet demand for financial services, thereby promoting financial inclusion in the country,â€ noted CCK.
It is this vast flow of funds that Finance minister Njeru Githae is currently going after, with new taxation measures that were passed by Parliament last week.
The new measures would see the government attach a 10 per cent excise tax on all mobile money transfer fees charged by cellular companies and other financial institutions.
Mobile subscriptions in the period under review rose by 17.5 per cent to 29.43 million. Mobile penetration in the country is now at 75.4 per cent.
Safaricom maintained the lead in the industry, with a 64 per cent subscription market share, a 4 percentage point drop from last year.
Telkom Kenya lost 0.3 percentage points in market share while Airtel and YuMobile both gained market share.
â€œWe attribute this strong growth to increased investments in our people, product innovation and improvement in quality of service has been the key driver in making us the network of choice by more customers in Kenya during the last quarter,â€ read a statement from Airtel.
Despite the increase in the number of mobile subscriptions, Kenyans are talking less.Â The minutes of use per subscriber per month fell by 20.3 per cent from a similar period last year.
Meanwhile, the period was tough for companies in the fixed data market as revenues fell drastically. CCK claims that revenue in the data market, excluding the mobile sector, fell by 88.7 per cent in 2011.