Kenya’s diaspora remittances fell 3.03 percent to $2.442 billion (Sh315.75 billion) in the first half of 2026, down from $2.518 billion (Sh325.58 billion) in the same period last year, according to Central Bank of Kenya data reported by Business Daily. The decline marks the sharpest January to June contraction since the aftermath of the 2008 global financial crisis, when a wave of job losses across advanced economies dragged remittances down by 11.4 percent in 2009.
The United States, historically Kenya’s single largest source of diaspora cash, drove most of the downturn. Remittances from the US fell 12.6 percent to $1.178 billion (Sh152.50 billion) in the six months to June 2026, compared with $1.348 billion (Sh174.50 billion) a year earlier a fall of nearly Sh22 billion. That decline was the sharpest since Kenya began publishing remittance data broken down by country, and it pushed US inflows to their lowest first-half level since 2021.
Notably, the US drop alone was more than twice the size of Kenya’s total remittance decline, underscoring how outsized America’s role is in the overall contraction.
The slowdown is due to a mix of factors. The fallout from President Donald Trump’s tax policies, combined with economic shocks stemming from the Iran conflict, weighed heavily on Kenyan workers’ earnings and transfer capacity in the US. Separately, the Iran war disrupted economic activity across Gulf countries such as Saudi Arabia, where thousands of Kenyans work, while also fueling inflation and slowing growth in major economies including the US.
CBK figures, show an 11.61 percent drop in North American inflows erased gains recorded from Europe and other markets during the half year. North American remittances fell by Sh21.70 billion to Sh165.26 billion, a contraction more than twice the size of the overall national decline, though partly cushioned by stronger receipts from Europe.
Despite the pullback, officials note the broader trend is one of moderation rather than collapse. H1 2026 still ranked as the second highest first half remittance total on record, trailing only the previous year’s peak. Diaspora inflows remain a critical pillar of Kenya’s external financing, helping to cover the country’s persistent trade deficit and support foreign exchange reserves. The CBK has signaled it is watching developments in the US labour market and Gulf region closely, as both will shape the trajectory of remittances for the remainder of 2026.
