Diaspora remittances hit record Sh34 billion in May

Central Bank of Kenya building in Nairobi. FILE PHOTO | NMG

By OTIATO GUGUYU
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Kenyans in foreign countries sent home a monthly record Sh34 billion ($315.8 million) in May, a 22 percent jump from the corresponding month last year, supported by higher flows from the US and Saudi Arabia.

This is the first time diaspora remittances have crossed the $300 million mark, continuing to defy expectations of a dip due to the Covid-19 pandemic.

Inflows from Asia jumped 12 percent month-on-month to Sh3.5 billion ($32.6 million), while remittances from North America—which includes the US, Canada and Bahamas— grew six per cent to Sh20.8 billion ($193.5 million).

Remittance from European countries grew three per cent to Sh7 billion ($65.8 million) while Africa stayed flat at Sh1.4 billion ($13.5 million).

“Remittance inflows increased to $315.8 million in May 2021, compared to $258.2 million in May 2020, representing a 22.3 percent increase,” Central Bank of Kenya (CBK) said in its weekly markets bulletin.

“The United States continues to be the largest source of remittances to Kenya, accounting for 57.8 percent of remittances in May 2021.”

There is, however, growing prominence of dollars from Western Asia, especially Saudi Arabia, from where Kenyans sent home Sh1.62 billion in May.

This is due to increasing migrant Kenyan labour to the region, including domestic workers, doctors, university lecturers, consultants, bankers, engineers, nurses and hotel managers.

At the onset of the pandemic, it was feared that diaspora dollars would take a hit as millions of people lost jobs when some lockdown measures were imposed.

However, massive support by rich countries to their populations helped reduce the impact of the job cuts and helped Kenyans in the diaspora send even more money back home to help their relatives cope with the pandemic.

The cumulative inflows in the 12 months to May 2021 totalled Sh363.3 billion ($3.365 billion).