Latest data from the Central Bank of Kenya (CBK) show that diaspora remittances 2020 rose 10.7% hitting Sh329.41 billion from Sh285.23 billion that was sent home the year before.
In a statement, CBK governor Patrick Njoroge said “Remittance inflows were strongly buoyant in 2020 despite the devastation by Covid-19 in the source countries,”
“This remarkable growth of remittances has been supported by financial innovations that provided Kenyans in the diaspora more convenient channels for their transactions.”
This, in spite of coronavirus-induced disruption, the share of remittances in the country’s foreign exchange receipts show that about Sh6.33 billion was sent home every week. The total remittances were 9.56 percent higher than the maximum of Sh300.67 billion ($2.824 billion) that Dr. Njoroge had projected in mid-2020.
The CBK projected a 12 percent fall in remittances to Sh232.2 billion due to job cuts and global economic disruptions.
Owing to a strong recovery in June, the apex bank revised this to a growth of just one percent. The strong performance came after remittances in December hit Sh32.91 billion. This is the highest to have ever been sent home in a single month.
December is historically a strong month for remittances when Kenyans abroad send home Christmas presents, rent to support families and school fees payments.
The United states with an estimated 90,000 Kenyans is the largest country in terms of remittances. However, the country has emerged as a global hotspot for Covid-19 infections and also experienced turmoil in its recently concluded national polls.
Inflows from Germany, the United Kingdom, Saudi Arabia, and Qatar also make up a significant component.
These remittances improved with gradual recoveries of major economies abroad. Also the various methods of sending cash and mobile money transfers helped in this regard.
Remittances to Kenya also defied the World Bank projection of about 20 percent expected to hit combined remittances across the world due to the coronavirus pandemic.
Kenya currently comes tops in diaspora remittances among East African countries. The amount the country receives is the single largest source of foreign currency ahead of major cash crops and tourism.
Since 2015 when it surpassed earnings from tea exports, foreign remittances have been Kenya’s largest source of foreign exchange. Other significant sources of foreign exchange include receipts from the hospitality as well as horticulture and coffee exports.
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