Kenya Revenue Authority has clarified that it will not monitor personal M-PESA transfers between individuals as part of its planned mobile money oversight measures.
The clarification comes after growing public concern over earlier statements indicating that the tax authority intended to strengthen monitoring of digital financial transactions.
KRA M-PESA Monitoring Targets Business Payments
Speaking during a citizen assembly in Meru, KRA Commissioner for Micro and Small Taxpayers George Obell said the agency is only interested in commercial transactions linked to businesses.
According to Obell, personal transfers between individuals, such as sending money to relatives or sharing expenses among friends, will not be tracked under the KRA M-PESA monitoring framework.
Instead, the focus will remain on transactions processed through merchant payment channels such as PayBills and Till Numbers.
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Earlier KRA Statements Raised Concerns
The clarification follows remarks made earlier this year by KRA Deputy Commissioner Maurice Oray, who said the authority had access to financial data showing activity among taxpayers who continued filing nil returns despite regular mobile money transactions.
At the time, KRA said it planned to introduce pre-filled tax returns based partly on available transaction data.
Under the proposed system, taxpayers would receive returns already populated with income information, requiring them to either confirm or dispute the figures.
Virtual ETR System Under Development
As part of the KRA M-PESA monitoring strategy, the tax authority is developing what it calls a Virtual Electronic Tax Register system.
The system is designed to integrate directly with digital payment platforms so businesses receiving electronic payments can automatically generate electronic tax invoices during transactions.
KRA said discussions with payment service providers are ongoing as the agency works on implementation details.
Mobile Money Central to Kenya’s Economy
Mobile money platforms such as Safaricom’s M-PESA play a major role in Kenya’s economy, supporting millions of personal and business transactions daily.
As a result, any suggestion of expanded monitoring has attracted significant public attention, particularly around privacy and taxation concerns.
Government Pushes Wider Tax Compliance
Kenya’s government has intensified efforts to expand the tax base and improve revenue collection amid rising public debt and growing fiscal pressure.
Digital payments and mobile commerce have become key focus areas as authorities seek to capture more economic activity within formal tax systems.
Read Also: KRA Tracks Traders Switching Till Numbers to Evade Tax
Outlook for KRA M-PESA Monitoring
KRA maintains that the monitoring measures are intended to improve compliance among businesses rather than track ordinary personal transfers.
However, analysts say the rollout of digital tax systems will continue raising questions around financial privacy, transparency and regulation as Kenya’s digital economy expands.
