I Tracked Fees Charged on My Mobile Money Payments in a Year, Results Were Eye Opening

Wondering if you are the only adult consumed by dependency on the use of mobile money for discretionary items - say Ksh10 chewing gum or Ksh20 fruit? Fret not, you are not alone. 

Data by the Communications Authority of Kenya, released in January this year, estimates that subscriptions to mobile money services increased from 39.8 million to 40.6 million in the first quarter of the 2024/25 financial year. This translates into a penetration rate of 78.9 percent countrywide.

Furthermore, the data shows that by March 2025, total mobile money transactions had hit Ksh8.7 trillion, nearly tripling the country’s 2024 Budget. This means that since its invention 18 years ago, more Kenyans have been onboarding onto the service and shunning cash use.

In my adult working life, I have seen more matatus shifting to paybills as a preferred mode of payments, and over the years, passengers have been adopting the practice, largely to avoid fuss with touts over fare balances. And over time, both small-scale candy shops, sellers at local markets, and large-scale retail stores have shifted to till numbers and rolled out self-checkout lanes.

So entrenched is the mobile money technology that banks have been forced to re-assess their MO (modus operandi) and either roll out their SIM cards or partner with the handful of mobile money players, relegating ATMs, which were once their bread and butter.

Also Read: How Much Mobile Money Charges Cost You This Year - The Past 10 Months

‍Breakdown of Mobile Money Fees I incurred in 2024

Whereas the mobile money technology has eased business-to-business, business-to-consumer, and consumer-to-consumer transactions, the largely negligible fees that accompany each transaction can, over time, expand to create a noticeable charge over a long period of time, say a year.

My typical day involves paying for roughly three commutes (Ksh100 per trip), sending money to friends (a Ksh200 transaction with a fee of Ksh7), family (a Ksh10,000 sent to dad attracts a Ksh90 fee), and bills (a Ksh300 water or power bill attracts a fee of Ksh5 and Ksh18,000 rent with a fee of Ksh62).

My mobile money data for 2024 (a leap year with 366 days) shows that I transacted a total of Ksh442,515, money that exited from my account. Of this, Ksh266,254 was directed to paybills (Ksh10,000 was paid to Kenya Power pre-paid account). Therefore, I estimate that the total fees for the paybill transactions are Ksh4,430.

For the year, I sent Ksh60,391 to Buy Goods tills (which have Ksh0 transaction costs) and withdrew Ksh46,050 (The withdrawal fee is estimated at Ksh1,000 since different amounts attract different fees- Ksh500 is Ksh29 while Ksh5,000 is Ksh87). In the period, I borrowed Ksh29,606 from overdraft (paid a fee of Ksh280) and purchased airtime of Ksh11,001 (also no transaction fees).

Overall, my yearly transaction fee added up to Ksh5,710 in the year 2024, a figure that can get you 11 KFC 2-piecer meals or 33 litres of petrol at Ksh174 per litre.

‍Benefits of Using Mobile Money

Whereas the mobile money’s annual fee seems a mouthwatering figure for some, many individuals will still choose it over withdrawing their funds and transacting in cash for these reasons;

Convenience and speed - Pre-mobile money transactions, businesses and their customers were forced to transact in cash, often resulting in time wasted looking for balance. Picture this, you hailed a boda boda ride at a cost of Ksh200 and have arrived at your location, no shop in site, and the rider tells you he has no the Ksh800 balance he owes you from the Ksh1,000 you just offered. Worse yet, you have given a matatu tout Ksh500, and you are fast approaching your destination, but he still cannot return your Ksh450 balance.

Therefore, settling instant transactions through mobile money is convenient for both parties involved, and it is great for emergencies or quick transfers.

‍Security - Individuals who use mobile money payments have also reported a reduction in the risk of theft or loss compared to carrying cash since, even if their mobile phone is stolen, their money is safely locked in a PIN-protected e-wallet.

‍Remote Payment & Traceability - Before mobile money, customers had to physically visit bank ATMs or power and water bill stations to pay for utilities, but mobile money offers a fast and instant mode of payment, replete with traceability features through SMS messages and email statements.

Also Read:Bank to M-Pesa Transaction Charges Across Banks in Kenya - 2023

‍Dangers of using mobile money

Apart from accumulated transaction fees, some users have, however, highlighted several other dangers to over-reliance on mobile money transactions, including;

‍Scams: In recent years, cases of social engineering scams, where fraudsters impersonate mobile money customer care staff to access client databases and phishing links targeting customers through SMS and WhatsApp to access data, have been on the rise.

A TransUnion analysis released in November 2024 showed that 4.6% of all attempted digital transactions where the consumer was located in Kenya were identified as suspected Digital Fraud in the first half of 2024, with retail, gaming, and communities (online dating, forums, etc.) being the most targeted.

‍Wrong Transactions: Some mobile money users have lost their money through making wrong transactions with the money ending in unintended accounts. Although reversals are possible, they are not guaranteed, especially if the recipient withdraws the money or tinkers with their balance.

‍Safety Tips‍

• To protect yourself, it is advisable never to share your PIN or confirmation codes with anyone, even mobile money customer care staff.
• Customers are also advised to double-check recipient numbers before proceeding with transactions
• Additionally, use a strong SIM card lock and be cautious of unsolicited messages, calls, and links.

Derrick Okubasu recently joined Money254 and previously served as an editor, as well as Head of Newsletters, at Kenyans.co.ke. Hit him up on X, @DerrickOkubasu.