Shocking Collapse: Rising M-Pesa Agent Numbers Cut Average M-Pesa Agent Commissions to Record Low

The numbers are stark and leave little room for soft interpretation. In the financial year that ended 31 March 2026, the average M-Pesa agent in Kenya earned just Sh112,244 in commissions for the entire year. That works out to roughly Sh9,353 a month before any operating costs. This figure marks a record low, down from Sh124,720 the previous year and Sh144,355 in the year ended March 2024.

The decline is not the result of falling transaction volumes or a shrinking M-Pesa ecosystem. On the contrary, the platform processed Sh41.68 trillion in the same period—equivalent to about 2.4 times Kenya’s nominal GDP—and facilitated more than 136 million transactions on an average day for 40.66 million customers. The culprit is far more straightforward and far more structural: the relentless expansion of the agent network itself.

Safaricom’s own disclosures show the agent count climbed to 333,011 by the end of March 2026, up from 298,890 a year earlier. That is nearly double the 173,000 outlets recorded in 2020. Over the three years to March 2026 the company added 70,995 new agents.

Total commissions paid out remained essentially flat at approximately Sh37.38 billion, barely changed from Sh37.27 billion in the prior year and actually lower than the peak of Sh37.82 billion reached in the year ended March 2024. When a roughly stable pie is sliced into ever more pieces, the average slice must shrink. This is basic arithmetic, and it is now producing real hardship for the thousands of small operators who once regarded an M-Pesa agency as a reliable livelihood.

The Long Slide in Average M-Pesa Earnings

To understand how dramatic the current situation is, one must look further back. Average annual earnings per M-Pesa agent peaked in 2016 at Sh145,768, when Safaricom paid out Sh14.68 billion to just 100,744 agents. At that time the network was still relatively exclusive, competition among agents was limited, and cash deposits and withdrawals dominated customer behaviour. Every subsequent wave of agent recruitment has diluted those returns.

The decline has been gradual enough that many operators could absorb it through higher volumes or side income from airtime sales. That buffer has now largely disappeared.

The latest average of Sh9,353 a month is, for most agents, insufficient to cover rent, security, float financing costs, and the wages of even a single attendant. In high-rent urban locations the figure is catastrophic. In rural areas where volumes are lower still, many outlets operate at a loss once all expenses are counted.

The Business Daily calculation that produced the Sh112,244 figure is itself conservative: it simply divides total commissions by the reported number of agents. It therefore includes low-activity and quasi-dormant outlets that pull the average down. Active, well-located agents earn more; poorly located or newly opened ones earn far less. The distribution is highly skewed, which means a substantial cohort of agents is surviving on significantly less than the already meagre average.

Rising M-Pesa Agent Numbers and the Competition Trap

The expansion of the agent network has been deliberate policy. Financial inclusion targets, regulatory encouragement of access points, and Safaricom’s own commercial interest in densifying its last-mile presence have all driven recruitment. The result is an intensely competitive local market for the same pool of cash-in and cash-out transactions. An agent who once enjoyed a near-monopoly in a trading centre now competes with three or four neighbouring outlets, plus bank agents from Equity, KCB and Co-operative Bank, and increasingly Airtel Money points.

This competition does not merely divide existing volumes; it also reduces the average ticket size and frequency of visits. Customers no longer need to travel far or wait in queues. Convenience rises, but so does the pressure on each individual operator’s float utilisation and commission yield. Safaricom benefits from the denser network through higher overall transaction volumes and stronger customer retention. The agents, however, absorb the cost of that density in the form of thinner margins.

Why Total Commissions Have Stagnated Despite Soaring Volumes

A critical question is why total agent commissions have not risen in line with the explosive growth in M-Pesa transaction value and volume. Several forces are at work simultaneously. First, the mix of transactions has shifted decisively away from pure cash deposits and withdrawals.

Lipa na M-Pesa revenues grew 21.7 per cent to Sh9.3 billion in the year ended March 2026. Pochi la Biashara revenue surged 86 per cent to Sh4 billion. These merchant and business-wallet flows generate revenue for Safaricom but do not produce the same agent commissions as traditional cash-in/cash-out activity. Customers who once withdrew cash to pay a landlord, school or market vendor now settle directly via mobile money. The agent is cut out of the value chain.

Second, airtime commissions—the traditional supplementary income stream for many agents—have also been under pressure. Although they recovered modestly to Sh9.41 billion in 2026 from a record low of Sh8.1 billion the year before, they remain well below the 2018 peak of Sh11.42 billion. Customers increasingly buy airtime directly through M-Pesa or use data-heavy apps that reduce traditional voice and SMS demand. Physical scratch-card sales, once a reliable add-on, have diminished.

Third, the commission structure itself is banded and has not been adjusted aggressively enough to compensate for the dilution caused by network growth. Agents still earn more from withdrawals than deposits in most bands, yet the absolute amounts remain modest relative to the capital tied up in float and the operating risks involved.

The Brutal Economics of Mobile Money Agent Profitability

The profitability equation for an M-Pesa agent has always been more precarious than outsiders assume. Float must be financed, often through expensive informal credit or personal savings. Theft and fraud remain constant risks. Regulatory compliance, including Know-Your-Customer obligations and cash-handling rules, carries both cost and administrative burden. When average commissions fall below the threshold needed to cover these costs plus a modest return on capital and labour, the business model breaks.

Many agents have responded by diversifying. The most common strategy is to become multi-brand: operating M-Pesa alongside Airtel Money and agency banking for one or more commercial banks under the same roof. This allows them to capture a wider share of local financial traffic. Others have added bill payments, micro-insurance, or small retail inventories. Those who cannot diversify—because of location, capital constraints or landlord restrictions—face a stark choice: subsidise the agency with other income or exit. Exit is already visible in some saturated urban pockets and in remote areas where volumes never justified the expansion in the first place.

Safaricom’s Agent Network Strategy and the Inclusion Trade-Off

From Safaricom’s perspective the expansion remains rational. A denser network deepens financial inclusion, raises the barrier to entry for competitors, and supports the broader shift of the company from a pure telecommunications operator to a technology- and financial-services platform. M-Pesa now generates the largest share of service revenue. The agent network is the physical manifestation of that dominance. Total commissions of Sh37.38 billion represent a manageable direct cost relative to M-Pesa revenue of Sh182.74 billion. The company’s contribution margins remain healthy even as individual agents struggle.

Yet the long-term sustainability of this model is open to serious question. If too many agents become unviable, the network will thin out precisely in the places where access is most needed. Quality of service may deteriorate as operators cut corners on float levels or customer experience. The incentive for fraud or collusion can rise when legitimate earnings are insufficient. Regulatory authorities and Safaricom itself will eventually confront the tension between inclusion metrics (number of access points) and the economic viability of those points.

What Agents, Policymakers and Safaricom Must Confront

Agents who treat the agency as a pure cash business are already being selected out. Survival increasingly requires treating the outlet as a multi-service financial and retail node. Location selection has become more critical than ever; high-traffic, mixed-use sites retain viability longer than pure residential or low-density locations. Capital for adequate float remains a binding constraint for many small operators, and innovative float-financing products—perhaps linked to transaction history—could ease pressure without increasing Safaricom’s commission bill.

Policymakers should recognise that simply counting agents is an incomplete measure of inclusion. An agent who is open only sporadically because commissions cannot cover costs does not deliver reliable access. Data on agent activity rates, average float levels, and exit rates would provide a clearer picture than headline network size alone.

Safaricom faces a strategic choice. It can continue prioritising network density and accept higher agent turnover, or it can adjust commission structures, introduce volume-based incentives for high-performing agents, or support diversification more actively. The current trajectory—stable total commissions alongside rapidly rising agent numbers—transfers the cost of inclusion onto the agents themselves. That transfer has now reached a point where it is visible in the national statistics as a record-low average earning.

The decline in average M-Pesa agent commissions is not a temporary blip. It is the logical outcome of a successful, aggressive expansion of financial access points in a market where the underlying economics of cash handling are being eroded by digital payments. The agents who built the system’s last-mile reach are now being asked to absorb the consequences of its maturity. Some will adapt and thrive as multi-service operators. Many others will not. The record-low figure of Sh112,244 is therefore more than a statistic; it is a warning that the traditional M-Pesa agency model, in its pure form, is reaching the limits of its economic sustainability.

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