(NAIROBI, KENYA) – The termination of major non-governmental organisation contracts by the United States government cut Kenya’s cash outflows by KES 25.3 billion ($196 million / £146 million) last year, according to new Central Bank of Kenya data.
Money sent from Kenya to individuals and households abroad through licensed remittance providers fell 27.5% to KES 66.57 billion ($515 million / £384 million) in 2025, down from KES 91.85 billion ($711 million / £530 million) a year earlier.
The decline offers a view of the economic disruption caused by President Donald Trump’s policy to limit foreign aid.
The Central Bank of Kenya attributes the drop mainly to the closure of several NGOs, including the United States Agency for International Development, which had supported relief and development programmes across the region.
These organisations generated financial flows in both directions, including money sent by foreign workers and other expatriates based in Kenya to their families and dependants abroad.
“The reduction in remittance outflows is largely attributed to the closure of several non-governmental organisations, including the United States Agency for International Development (USAid),” the Central Bank says in its 2025 Bank Supervision Annual Report.
“The NGOs provided relief services within the African region, thereby supporting substantial financial inflows and outflows within the region. The shutdown of these organisations significantly affected countries such as Somalia, where NGO-related funding constitutes a substantial share of external financial inflows.”
The drop means Kenya sent KES 25.28 billion ($196 million / £146 million) less abroad through remittance providers than the record amount in 2024, marking a sharp reversal in a segment that includes payments by individuals working in Kenya and other international transfers.
The decline came as the Trump administration began one of the biggest restructurings of US foreign assistance in decades.
On taking office in January 2025, Trump ordered a 90-day review of US foreign assistance under his “America First” policy and directed a pause in new foreign assistance obligations and disbursements.
USAid began terminating programmes and contracts as the administration moved to dismantle the agency. Reuters reported in February last year that the administration was eliminating 1,600 USAid jobs in the US as part of the restructuring.
The effects of Trump’s order quickly spread to countries where USAid-funded organisations were major employers.
In Kenya, Business Daily analysis showed the value of terminated USAid contracts and grants had reached KES 108.34 billion ($839 million / £625 million) by early March last year. The programmes covered areas including trade and investment, education, energy, health, rural development and governance.
The cuts hit an ecosystem extending well beyond NGOs themselves. Healthcare was among the sectors most immediately exposed.
A KES 67.43 billion ($522 million / £389 million) deal by DAI Global was one of the single biggest casualties of a purge by the US Department of Government Efficiency on USAid projects in Kenya. The DAI Global contract, called the Prosper Africa Trade and Investment Activity, was scheduled to run from 25th September 2021 to 24th September 2026, and aimed to boost trade and investment between the US and African nations.
The DAI Global programme was actively involved in Kenya by helping to connect Kenyan businesses with American investors, particularly in sectors such as agriculture. Notable activities under the programme included supporting investments in canola oil production through AgDevCo funding, market assessments to identify investment opportunities, and working with USAid Kenya East Africa Mission to promote private sector engagement in the region.
The Joint United Nations Programme on HIV and AIDS reported that US-funded medical personnel, including doctors, clinical officers, nurses, laboratory technologists, pharmacists and community health workers, were affected by the stop-work order. Civil society organisations and community-based groups also faced funding cuts and loss of staff.
Other parts of the economy were exposed through large development programmes that were cancelled or scaled down.
The disruptions created a chain extending from international donors to NGOs, contractors, consultants, health workers, teachers, researchers and other service providers.
The remittance market felt the effects through organisations sending money to projects and suppliers, as well as through individuals whose incomes depended on the aid-funded economy.
Foreign nationals working for NGOs, development agencies, consultancies and implementing partners are among the people who send part of their salaries from Kenya to relatives and dependants in their home countries.
The cancellation of contracts and layoffs that followed cut the ability of some of these workers to make such transfers. Similar pressure was applied to Kenyan workers with financial commitments abroad, including school fees, family support and other obligations.
The disruption also reached Kenya’s savings and credit cooperatives sector, where regulators warned that saccos whose membership was concentrated among workers in donor-funded organisations faced pressure from the loss of external funding.
The Sacco Societies Regulatory Authority last year identified 16 regulated saccos with 72,172 members and a combined KES 37.41 billion ($290 million / £216 million) in deposits as directly exposed to changes in donor funding and global geopolitical developments.
The affected institutions comprised two deposit-taking saccos and 14 non-withdrawable deposit-taking saccos whose members were drawn largely from donor-funded projects, institutions and programmes.
Sasra warned that the funding disruption could trigger member exits, increased demands for withdrawal of savings, slower loan growth and deterioration in loan quality as affected workers lost income.
“The Authority projects that a total of 16 regulated SACCOs…will be directly affected by these policy changes and thus likely to experience sharp reduction in their membership with increased member exits and demands for deposits (savings) refunds, coupled with reduction in the growth of loan assets or deterioration of the quality of loans due to potential default,” Sasra said in September last year.
The reduction in outflows contrasted with the continued growth of money coming into Kenya from its diaspora.
Remittance inflows through money remittance providers rose 14% to a record KES 503.34 billion ($3.9 billion / £2.9 billion) in 2025 from KES 440.18 billion ($3.4 billion / £2.5 billion) in 2024. The Central Bank attributed the increase, particularly towards the end of the year, to higher flows from Kenyans in North America and Europe.