Kenya’s Mobile Money Agent Network Shrinks as Digital Payments Expand

Kenya’s mobile money market is expanding while its traditional agent network is contracting, highlighting a shift from cash-based transactions to direct digital payments.

Data from the Communications Authority shows that the number of registered mobile money agents fell from 602,470 in March to 568,463 in June 2026. The 5.6% decline represents roughly 34,000 fewer registered agents over the three-month period.

The reduction occurred as total mobile money subscriptions rose from 53.37 million to 54.01 million, a 1.2% increase. Subscriptions were also up 13.2% annually, according to the data.

Digital channels reduce reliance on agents

Customers can now make many payments without visiting an agent or withdrawing cash. These options include Buy Goods tills, Pochi la Biashara, PayBill numbers, bank-to-wallet integrations, app-based banking, QR-code payments and direct merchant checkout.

Buy Goods tills allow payments to be made directly to merchants through M-PESA or Airtel Money, while Pochi la Biashara is an M-PESA business wallet for small traders. PayBill services are used for payments to organisations including schools, insurers and utility companies.

This transition is putting pressure on agents whose earnings have traditionally depended on commissions from deposits and withdrawals. As more consumers use merchant payment channels, agents face fewer cash-in and cash-out transactions from which to generate income.

Safaricom remains the leading provider, accounting for 88.8% of mobile money subscriptions, compared with 11.1% for Airtel Money.

Higher costs add to pressure

Agents are also dealing with rising business expenses. An agent in Kisii said operating costs had become difficult to manage and reported that M-PESA shops generate between KES 11,000 ($85) and KES 30,000 ($230) in monthly commission. The agent said business permit costs had increased by 30%, alongside higher rent and attendant wages.

“Cost of operation is high,” the agent said.

An operator in Ruaka described a similar squeeze. The operator said that when monthly commission stood at KES 22,000 ($170), rent was KES 3,000 ($23) and a worker was paid KES 5,000 ($38). The operator said current rent starts at KES 5,000 ($38), while attendants demand KES 7,500 ($58), with additional expenses and fraud cases also affecting the business.

The source says thousands of operators have closed their shops as transaction volumes decline, fixed costs rise and regulatory scrutiny increases. It does not provide an exact number of closures or distinguish between businesses that shut permanently and agents who simply stopped being registered.

Smartphone growth changes the market

The Communications Authority data also points to wider adoption of smartphones and mobile broadband. Smartphone connections increased from 50.18 million to 52.26 million between March and June, while mobile broadband subscriptions grew by 2.07 million. Feature-phone connections declined to 27.42 million in June.

Mobile data subscriptions reached 64.26 million, following an increase of 1.63 million during the period. The figures are supporting a move towards app-based banking, QR-code scanning and other direct digital payment methods.

For mobile network operators, the decline in physical cash handling and distribution costs presents an opportunity. However, agents remain important for onboarding people who are not fully digital, managing liquidity and serving rural customers.

An unnamed industry executive said government scrutiny of mobile money accounts and the Kenya Revenue Authority’s use of transaction data for tax compliance had raised privacy concerns among some businesses and consumers.

As cash transactions continue to lose ground, operators will need to find additional ways for agents to earn revenue beyond deposits and withdrawals.