The proposed legislation prevents Safaricom and Airtel Kenya from using customer balances as their own funds, instead allowing them to invest trust-held funds in Kenyan government securities or interest-bearing trust accounts, provided they maintain sufficient funds to cover customer debts.
A key issue arises for mobile-money users: who benefits from returns generated by the money in their wallets?
How the System Would Work
The basic mechanism is relatively straightforward. When a customer loads money, it becomes part of the funds backing their mobile-money balance. That money is held in trust, kept separate from the provider’s own operating money. The customer remains entitled to their balance, and the trust must maintain enough money to meet customer claims. The return from the investment becomes income associated with the trust.
This is important because the proposal is not the same as fractional-reserve banking. If customers are collectively owed KES 100 billion, the provider cannot simply invest KES 70 billion and use the remaining KES 30 billion for its own business. The trust arrangement has to continue backing the customer balances. The Bill also provides protections against trust funds being used to meet the provider’s ordinary liabilities.
How M-Pesa and Airtel Money Stand to Benefit
The attraction for mobile-money operators is the scale of the float. M-Pesa processed KES 41.7 trillion in transactions in the year ending March 2026. That is not the amount sitting in customer wallets, since money can move through the system multiple times. The more relevant figure is the average amount of customer money held in the system at any given time. Even a relatively modest return on a large pool of funds can generate significant income.
For Safaricom, it potentially adds another source of value around the M-Pesa ecosystem. For Airtel, it could strengthen the economics of Airtel Money as the operator expands its financial-services business. Airtel Money had 53 million users across 13 African markets as of September 2026, according to Reuters. The proposed rules could therefore make the business of holding and managing mobile-money balances more valuable for both operators.
Customers May Not Receive the Interest Automatically
The proposed law does not automatically grant customers interest on their M-Pesa or Airtel Money balances, instead allowing income from the trust arrangement to be used for public charitable purposes or other prescribed purposes, subject to CBK approval.
Former CBK Governor Patrick Njoroge has proposed a different approach. He wants surplus income from the trusts, after operating costs and related expenses, to be distributed to wallet holders through regular bonus payments. That is a proposal for changing the economics of mobile money, rather than a benefit already guaranteed by the Bill.
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For customers, the potential upside is straightforward. If the final rules allow part of the investment income to be passed back to wallet holders, keeping money in M-Pesa or Airtel Money could generate a small return instead of simply sitting idle.
The bigger question is how such a system would be calculated and distributed. The draft Bill does not specify a formula for how any potential customer share would be determined.
This leaves room for different interpretations. A provider might distribute a flat bonus per user. Another could choose a percentage-based approach tied to the average balance held. The exact method would likely be defined in future regulations.
The Regulatory Path Ahead
The National Payment System Bill, 2026, still requires approval from Kenya‘s Parliament. Before it becomes law, it will undergo committee scrutiny. This process could lead to amendments to its current text.
The current draft gives providers flexibility in how the trust income is used.
The Central Bank of Kenya will also play a key role. The Bill grants the CBK authority to supervise these trust arrangements. This includes approving the types of investments and the uses of the income generated.
Providers would need to demonstrate that customer funds are fully backed and that trust income is handled correctly.
The final law could set a precedent for other African nations. Countries with large mobile-money sectors may watch Kenya’s implementation closely. A successful model could be adopted elsewhere.
