(Bloomberg) -- Kenya, a leading pioneer in mobile-money transactions, saw transfers grow last year at the slowest pace since 2007 after the government increased excise duty on transaction fees. 

The value of transactions rose to 7.95 trillion shillings ($49 billion) in 2023, compared with 7.91 trillion shillings the previous year, according to Central Bank of Kenya data. The number of mobile wallets jumped 6% to 77.3 million at the end of 2023.

The growth in value of transactions by 0.5% in 2023 is the slowest pace since the service was introduced in March 2007. Excise duty on transaction fees was raised to 15% last year from 12% previously, according to the Kenya Revenue Authority. 

The central bank captures data from mobile-money agents, and not from alternative channels such as phone-based apps that have grown exponentially, according to Silha Rasugu, an analyst at EFG Hermes. Hard economic times have also affected disposable incomes, he said. 

“Those transactions reflect the consumer wallet as well,” Rasugu said. “It could be a signal of consumers under pressure.”

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