ATMs decline in reduced cash use

The number of automated teller machines (ATMs) in the country fell by 19 per cent last year to 2,366 from 2,412 in 2020.

The Central Bank of Kenya (CBK) in its latest Financial Sector Stability report published earlier this week has attributed the decline in the number of ATMs to reduced cash usage.

Previously in its annual banking sector report, the reserve bank tied the general decline in the cash machines to the adoption of mobile phone and digital banking in the banking industry.

December 2021 marked the largest monthly decrease in the number of ATMs across the country at 16 with rare increases in the number of cash machines being seen in February and June alone.

The reduced cash usage is however masked by official monetary statistics which aggregates both physical notes and coins and cash held in mobile money wallets.

Additional data from the CBK shows the monetary base (M0) represented by coins and physical paper in circulation rose by 11.8 per cent last year to Ksh.253.5 billion and but declined by 0.6 per cent in four months through April 2022 to Ksh.252 billion.

Meanwhile currency in circulation less cash in banks and demand deposits or M1 rose by 7.7 per cent year over year in 2021 to Ksh.1.848 trillion and by a further percentage point to Ksh.1.867 trillion in April this year.

Mobile money statistics meanwhile reveal the growing importance of digital cash in the financial system.

For instance more data from the reserve bank shows mobile money agents rose by 3.8 per cent last year to 298,272 while the number of mobile money subscriptions rose by 2.2 per cent in the same period to 68.03 million.

The number of the subscriptions has grown by a further 1.1 per cent to 68.72 million as of April 2022.

Meanwhile the number of monthly mobile money transactions measures as total agent cash in-cash out moved from 173.9 million in January 2021 to 189.8 million in December before slightly easing to 188.24 million in April.

The value of monthly mobile money transactions nevertheless continues to stretch having moved from Ksh.590.4 billion in January last year to Ksh.622.1 billion in December before a further extension to Ksh.663.5 billion in April.

According to data from the Communication Authority of Kenya (CA) the total value of deposits held within mobile money services in the quarter ended in March 22 stood at Ksh.1.258 trillion.