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Kenya, November 08, 2026 - When Jattan Abdi left Kenya for Dubai in 2022, he did not imagine that one day his greatest responsibility would be rebuilding the life he had left behind.
A Kenyan-born former entrepreneur, Jattan had established several small businesses in Nakuru's White House area before the Covid-19 pandemic disrupted his investments and eventually brought them down.
He had left his family behind in Kenya in pursuit of better opportunities, hoping that his earnings abroad would provide the financial security they needed.
But while he was away, a series of financial setbacks involving his father plunged the family into a crisis. They lost much of their property, their financial stability deteriorated, and the situation became even more difficult when his father developed high blood pressure following the distress.
For Jattan, who works in a Dubai hotel as a CCTV surveillance officer, the news was devastating. He was thousands of kilometres away, unable to sit with his family, assess the situation physically or take immediate control of the challenges unfolding at home.
His only immediate option was to send money.
"It was frustrating for me, family calling me left, right and centre, with all forms of allegations. And as the firstborn of the family, there was not much I could do. The worst thing happened when I was told that my dad had suffered high blood pressure through the loss," Jattan said.
He began sending money to meet his father's medical expenses and address the family's financial obligations. Through sustained financial support, he gradually helped the family recover what had been lost.
For him, remittances were no longer simply money sent to relatives. They became a means of restoring stability and rescuing a family from circumstances that threatened to overwhelm them.
"You know, I imagine how it could have been like just being present without money to take care of the actual problem, because you see, the businesses had gone down. I don't know what to say," he added.
His experience illustrates a reality often missing from conversations about international money transfers: for many Kenyans abroad, sending money home is not an occasional gesture of generosity. It is an ongoing responsibility, sometimes involving decisions that determine whether a family can afford healthcare, retain property, pay rent or meet basic needs.
For 44-year-old Loise Wachira, the decision to seek employment outside Kenya came at a time when her circumstances had become increasingly difficult.
A single mother of two, Loise had previously relied on cleaning jobs to support her household after losing her main job. However, she began developing chest-related health complications that affected her ability to perform her duties.
The condition disrupted her employment, and she repeatedly lost jobs as her health deteriorated. Without a reliable income, she struggled to meet even the most basic household expenses.
"I was forced to move from a two-bedroom apartment to a one-bedroom because even raising money for food was so hard. I became a beggar at some point, and so I was forced to give out my daughter to one of my relatives," she recalled.
The financial pressure continued to mount. She accumulated six months of rent arrears, while her landlord repeatedly threatened to evict her and her son.
It was at this point that she was linked to an employment opportunity in Qatar.
Before travelling, she spoke to her landlord, who agreed to allow her son to remain in the house as she sought employment abroad.
The arrangement eventually provided the turning point she needed.
After a few months of working abroad, she cleared the outstanding rent arrears. Her son was also able to enrol in college, while her financial position gradually improved.
Today, she sends money directly to her landlord to meet rental obligations and transfers additional funds to her children to cater for their daily needs.
"To be honest, I don't know what I could have done, because I was already overwhelmed and I was losing hope in life. Nowadays, I pay rent directly to the landlord, and the rest of the expenses are taken care of with direct remittance to my son and daughter. I was now able to host even my sister's son in our house without stress," she said.
For Loise, the money she sends home has created a level of stability she once thought was beyond reach.
Her story, like Jattan's, demonstrates how remittances can extend beyond household consumption to support education, healthcare, housing security and the wellbeing of extended families.
While individual experiences reveal the human impact, national figures show just how significant these financial flows have become for Kenya.
A 2025 Remittances Household Survey conducted by the Central Bank of Kenya (CBK), the Kenya National Bureau of Statistics (KNBS) and Financial Sector Deepening Kenya found that Kenyan households received KSh931.8 billion in remittance inflows between June 2024 and May 2025.
The United States was the largest source, accounting for 43.5% of the total, followed by Germany and Australia.
The survey also found that more than 92% of remittance inflows were received through formal channels, including banks and mobile money platforms.
Perhaps more revealing is the role these funds play in household survival. Among the households surveyed, 22.3% identified remittances as their main source of livelihood, while 42.3% considered them supplementary income.
These figures underline the extent to which families have come to depend on money sent by relatives working abroad.
The benefits are also felt beyond individual households.
Remittances support local businesses when families use the money to purchase goods and services. They help keep children in school, finance medical treatment, pay rent, support construction and enable relatives to employ local service providers.
At the national level, these inflows contribute to foreign exchange availability and help support Kenya's external position.
The CBK's monetary policy data shows that annual diaspora remittance inflows reached approximately US$5.04 billion in 2025, making the diaspora an important source of foreign exchange for the country.
However, the importance of these flows raises another question: what happens when the systems facilitating the transfers become more expensive or difficult to navigate?
For remittance companies operating in the United States, the regulatory landscape has become increasingly demanding.
Money transmission is not regulated through one single nationwide licensing system. Although federal laws establish important obligations, including anti-money laundering and financial reporting requirements, individual states also exercise regulatory authority over money transmission businesses.
This means that a company seeking to serve customers across several states may have to navigate different licensing procedures, regulatory expectations, reporting obligations, bonding requirements and examination processes.
For providers, this creates an expensive and administratively demanding operating environment.
The complexity is particularly significant for smaller remittance businesses that may not have the financial and technical resources available to larger international money transfer corporations.
To address some of these challenges, the Conference of State Bank Supervisors (CSBS) has been advancing the Money Transmission Modernization Act, a framework intended to harmonise key requirements across states.
However, progress has not been uniform.
In September 2026, CSBS reported that 31 states had adopted the framework in full or in part. Differences in adoption and interpretation continue to create inconsistencies in supervision and regulation.
For companies operating across multiple jurisdictions, this means regulatory harmonisation remains a work in progress.
For Garad Nor, Chief Executive Officer of Banana Pay LLC, a US-based remittance company, the challenge is not that providers want to operate outside the law. Rather, it is the cost and fragmentation of the regulatory system they must navigate.
Nor says companies can face oversight from both federal and state regulators, with examinations and compliance requirements adding to the cost of running a remittance business.
"Compliance is very important, but it is making the business harder to operate because it is costly. In some states, we have two regulators: the federal regulator and the state regulator. The states may come every year or every two years, while the federal regulator can come at any time," he said.
He argues that the situation places a particularly heavy burden on smaller companies that have to maintain compliance systems while competing in a market dominated by larger operators.
For Nor, one possible solution would be a more coordinated regulatory framework that reduces duplication without compromising oversight.
"Is there a way we can have one body regulating the business instead of having two, three or four? That would make it easier, especially for small businesses like ours," he said.
He believes technology could offer a practical way forward, allowing regulators to monitor transactions more efficiently instead of relying heavily on costly and repetitive physical examinations.
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"I wish regulators would make remittance easier, allowing money to flow easily but also making it easy to track. Technology can help. Companies should have more systematic compliance technology, and governments should also invest in systems that allow them to monitor every transaction easily instead of charging businesses a lot of money," he said.
His argument points to a wider policy debate: how can governments strengthen financial oversight while making it possible for legitimate remittance businesses, particularly smaller operators, to remain competitive?
The need to prevent money laundering and other financial crimes is not in dispute. However, Nor believes regulatory systems should be designed in a way that reduces unnecessary duplication and makes compliance more efficient.
While regulation is necessary to safeguard the financial system, industry players caution that making formal remittance channels too expensive could drive some customers towards informal and unregulated alternatives, making transactions harder for authorities to monitor and increasing the risk of illicit financial activities.
The regulatory debate has also been complicated by a new federal remittance transfer tax introduced under the One Big Beautiful Bill Act.
Effective January 1, 2026, the United States introduced a 1% excise tax on qualifying international remittance transfers funded using physical cash, money orders, cashier's cheques or similar physical instruments.
Under Section 4475 of the US Internal Revenue Code, the sender is responsible for paying the tax, while the remittance provider is required to collect it and remit the proceeds to the government.
Importantly, the tax does not apply indiscriminately to every international money transfer. Transfers funded through qualifying bank accounts and other electronic payment methods are treated differently under the law.
The distinction matters for people in the diaspora because the impact depends partly on how they fund their transactions.
For Nor, however, the introduction of the tax comes at a time when remittance businesses are already experiencing pressure from operating costs and changing market conditions.
He says the additional 1% can influence how much customers spend when sending money, although he acknowledges that the wider market environment also affects transaction volumes.
"Before, people were complaining about the fees. The average fee is now around three dollars, and with the additional 1%, it could go up to four dollars, depending on the transaction," he said.
Nor says the company has observed some changes in customer behaviour and the amount of money people are sending.
However, he cautions against attributing every change in remittance activity to taxation alone.
"Taxation might be a factor, but I believe the market also plays a role. There are other factors, including market behaviour, gas prices and the war situation, as well as what is happening in the United States," he said.
For him, the ultimate question is whether taxation and regulation can be structured in a way that benefits the government, the service providers and, most importantly, the customers.
The concern is that when the cost of sending money rises, families depending on regular transfers may have to reconsider how much they send and how frequently they do so.
The debate is not confined to the United States.
In Kenya, the government also imposes excise duty on fees charged for money transfer services by banks, money transfer agencies and other financial service providers.
The applicable rate is 15% of the excisable value of the service fee. The duty also applies to fees charged for money transfer services by cellular phone and payment service providers.
This distinction is important: the excise duty is imposed on the fee charged for the transfer service, not automatically on the entire amount a relative sends home.
For example, if a provider charges a customer a transfer fee, the excise duty applies to the taxable service fee rather than the principal remittance received by the family.
There is also a separate question around the taxation of income earned abroad. Kenya generally operates a source-based tax system, although certain categories of foreign income earned by Kenyan residents may be taxable under specified circumstances.
Consequently, money sent by a Kenyan abroad to support a parent, child or relative should not automatically be treated as taxable income merely because it crosses an international border.
The nature and source of the funds matter.
The distinction is particularly important for families that depend on regular support for medical expenses, school fees, rent and other basic needs.
For remittance service providers, these developments present a difficult balancing act.
Companies must maintain systems that satisfy regulatory requirements in the countries where they operate, while ensuring that transactions remain affordable, accessible and efficient for customers.
In the United States, state-level licensing and supervision can increase the cost of entering and maintaining operations across different jurisdictions.
Providers may have to invest in legal advice, compliance personnel, transaction monitoring, customer verification, reporting systems, audits and regulatory examinations.
These obligations are important. They help protect customers, prevent money laundering, discourage financial crime and strengthen confidence in the financial system.
However, the cost of compliance can be particularly challenging for smaller operators.
When the cost of running a remittance business increases, providers may have to reconsider their pricing, reduce their operations in certain markets or invest more heavily in technology and compliance infrastructure.
For consumers, the consequences could include higher fees, fewer available providers or reduced access to services in some communities.
The concern is not that remittance providers should operate without oversight. Rather, it is whether regulatory systems can protect financial integrity without unnecessarily making it difficult for legitimate businesses to facilitate money transfers.
For families such as Jattan's and Loise's, international money transfers are not abstract financial transactions.
They are what enables a father to access medical treatment, a child to remain in school, a landlord to receive rent and a household to recover from financial distress.
Their experiences also reveal an important feature of diaspora support: the money does not always stop with the immediate recipient.
It often circulates through extended families and local communities, supporting relatives, small businesses, landlords, schools, hospitals and other service providers.
The CBK and KNBS household survey found that remittances are particularly important to rural households, reinforcing their role in reducing financial vulnerability beyond Kenya's major urban centres.
Kenya's National Financial Inclusion Strategy 2025–2028 recognises the need to lower remittance transaction costs, strengthen formal transfer channels and encourage the productive use of diaspora funds.
It also highlights the potential for remittances to contribute more directly to investment and national development.
This raises a broader policy question for both sending and receiving countries: how can governments encourage safe, transparent and well-regulated financial transfers without undermining the very households and businesses that depend on them?
For Jattan, the answer is deeply personal.
He knows what it means to receive a distressing call from home and have no immediate way of being physically present. He also knows that the ability to send money can mean the difference between a family losing everything and finding a way to rebuild.
For Loise, it is the difference between struggling to feed her children and being able to provide them with a home, education and a measure of security.
Their stories remind us that behind every remittance transaction is a human relationship, an obligation and, often, a family waiting for help.
As governments tighten financial controls and providers navigate an increasingly complicated regulatory environment, the challenge will be to ensure that the systems designed to regulate remittances do not make it harder for the people who depend on them to send and receive support.