A record month, a shrinking US corridor: what Kenya's 2026 remittance data are telling us
In August 2026, Kenyans abroad sent home US$451.8m through the channels the Central Bank of Kenya (CBK) counts. That is the highest month in CBK's series, which goes back to 2004. It is a record in nominal dollars, and by the narrowest of margins: about US$1.6m above March 2026.
This matters. CBK estimates that remittances were about 4% of Kenya's GDP in 2024.
Records make headlines. They can also hide more than they show. When I put the monthly figures next to the running annual total, the story looked different.
A flat year behind a record month
From January to August 2026, remittances totalled US$3,330m. That is 0.7% less than in the same months of 2025.
The 12-month total has been stuck at about US$5.0bn for more than a year. It peaked at US$5,084m in the 12 months to June 2025. In August 2026 it stood at US$5,013m.
The slowdown started before 2026. Inflows grew 18.0% in 2024 and only 1.9% in 2025.
Monthly numbers swing a lot. In 2026, year-on-year changes ranged from +8.0% in February to −11.2% in June. One good month is not a trend.
So where is the weakness coming from?
One corridor, and a second one
Mostly from the USA. Flows from the USA fell 12.4% over January to August 2026, a drop of US$226m. In August alone they were down 15.4%, at US$205.2m. June 2026 was the weakest US month since April 2021.
The USA is still Kenya's largest source. But its weight is falling. It sent 54.2% of Kenya's recorded remittances in January to August 2025, and 47.8% in the same months of 2026. In August 2026 alone, the share was about 45%.
Canada went the other way, up 13.6% over January to August. That is only about US$15m. It does not offset the US fall.
The second weak corridor is Saudi Arabia. Flows from there are down 53% over January to August, about US$124m. That fall began in August 2025, months before the US tax, and has been linked to Saudi Arabia's new work-permit rules. In August 2026, Tanzania sent Kenya more than Saudi Arabia did.
Almost everywhere else is up. Together, all other sources rose by about US$326m, or 25%. The UK, Australia, the UAE and Kenya's African neighbours all grew. The total is flat because big losses in two corridors are being made up elsewhere.
What the US tax does and does not explain
Since 1 January 2026, the USA has charged a 1% excise tax on some remittances (26 U.S.C. §4475). It applies only when the sender pays with cash, a money order, a cashier's check or a similar physical instrument. Transfers funded from a bank account, or with a US debit or credit card, are exempt.
The timing coincides with the decline. That is why the dashed line is on the charts. But the tax cannot explain the fall, for three reasons.
First, it is small: 1%. Second, it is narrow: it only touches cash-funded transfers. Third, the timing is uneven. US inflows were down 4.6% in January to March, with February and March close to normal. The steep part came later: down 16.9% from April to August. A tax effect would show up in January and stay roughly the same.
There is also a logic worth spelling out. Suppose senders simply switched from cash to an exempt app, funded by card or bank. That money would still land in M-Pesa or a Kenyan bank account through licensed channels. CBK would still count it. Switching to digital would not show up as a fall.
So a measured fall points to one of three things: people sending less, money moving outside the channels CBK counts, or changes in where transfers are booked. CBK's data cannot tell us which.
Europe is a separate story
Remittances from Europe rose 16.5% over January to August. It is tempting to read that as US money being redirected. I don't think the data support it. Europe was already growing by about 10% a year in the second half of 2025, before the tax. And the gains are broad, not just European. I will look at Europe in a separate piece.
What the official numbers can and cannot see
Licensed channels, including M-Pesa payouts, are counted in CBK's data. CBK says it collects remittance data from authorised providers "such as Commercial Banks, Money Transfer Operators and Mobile Network Operators". Safaricom's own remittance subsidiary, which carries international transfers into M-Pesa, is licensed by CBK as a money remittance provider.
Hawala and crypto are not counted. Neither is cash carried home. A 2025 household survey by KNBS, CBK and FSD Kenya put informal channels at about 8% of cash received, with crypto negligible. That survey covers June 2024 to May 2025. Nobody has measured behaviour since January 2026.
CBK's method for attributing a transfer to a source country isn't documented. CBK also publishes no breakdown by channel. The household survey report even describes bank data as the main source, which sits awkwardly with CBK's own statement. A short methodology note from CBK would help everyone who uses these numbers.
Questions I'm still asking
These are open questions, not conclusions.
- Enforcement. Is US immigration enforcement reducing the number of Kenyans who send money, or how much they send?
- The US labour market. Are Kenyan workers in the USA earning less, or working less? CBK data cannot answer this. It needs US data on migrant employment.
- Informal and crypto rerouting. Has some money moved to hawala or crypto since January? Before 2026, informal channels were small and crypto was negligible. A big shift would be a large change in behaviour.
- Booking through UK or EU hubs. Could some transfers that start in the USA be booked through UK or European hubs, and recorded under those countries? Without a documented attribution method, this cannot be tested.
What I will watch
The September to December releases. December is usually the strongest month. Whether the US decline deepens or levels off. Whether Saudi flows recover. And whether Europe and the rest keep growing.
How I built this
The totals come from CBK's monthly diaspora remittance table, which starts in 2004. Country figures come from CBK's "Remittances by Source" file, which starts in February 2019. I processed the data in Python: year-on-year changes, 12-month rolling sums and averages, and the USA's share of the total. I made the charts myself. All figures are in nominal US dollars and cover recorded, formal-channel inflows only. Data to August 2026, accessed 28 September 2026.
Sources
- Central Bank of Kenya, Diaspora Remittances (monthly table)
- CBK, Remittances by Source, August 2026 (Excel)
- CBK press release on the 2025 Remittances Household Survey, 4 August 2025
- 2025 Remittances Household Survey Report (KNBS, CBK, FSD Kenya)
- 26 U.S.C. §4475, remittance transfer tax (Cornell LII)
- Safaricom, M-Pesa Global
- Business Daily, "Saudi remittances fall over permit rules", 25 May 2026
- Business Daily, "Kenya's diaspora inflows from Tanzania overtake Saudi Arabia for first time", 21 September 2026
Code to reproduce this analysis: github.com/eokinyo/kenya-remittances-2026