Business Payments to Kenya: Complete Guide for International Companies

Whether you're paying Kenyan suppliers, contractors, or business partners, this guide covers everything you need to know about B2B payments to Kenya.

Business Payment Landscape in Kenya

How Kenyan Businesses Receive Money

Key Considerations

• Exchange rates: Can significantly impact large payments
• Transfer fees: Vary widely by provider
• Speed: Some methods take days
• Documentation: Important for tax and accounting

Best Options for Business Payments

1. Wise Business (Best Overall)

Why It's Good:

• Mid-market exchange rate
• Transparent fees (~0.5-1%)
• Batch payments feature
• Integration with accounting software
• Multi-currency account

Best For: Regular payments, multiple recipients

Costs ($5,000 payment):

• Fee: ~$25-50
• Exchange rate: Mid-market
• Total cost: ~0.5-1%

2. OFX (Best for Large Amounts)

Why It's Good:

• Dedicated account manager
• Custom rates for volume
• Forward contracts available
• No maximum transfer limit

Best For: Payments over $10,000, ongoing supplier relationships

3. PayPal Business (For Digital Services)

Why It's Good:

• Instant for digital services
• Familiar to many Kenyans
• Invoice integration

Cons:

• High fees (4-5%)
• Limited to PayPal users

4. Bank Wire (Traditional)

Why It's Good:

• High limits
• Widely accepted
• Good for one-time large payments

Cons:

• High fees ($25-50+ per transfer)
• Poor exchange rates
• Slow (2-5 days)

Cost Comparison: $10,000 B2B Payment

Payment Documentation

What You Need

For each payment, document:

• Invoice from Kenyan business
• Payment confirmation/receipt
• Exchange rate used
• Recipient bank details

Tax Considerations

• Withholding tax may apply (varies by service type)
• Keep records for VAT purposes
• Some payments require KRA documentation

Paying Kenyan Freelancers and Contractors

Popular Methods

1. Wise: Low cost, direct to bank
2. PayPal: Convenient but expensive
3. Payoneer: Common for remote workers

Compliance Considerations

• Contractor vs employee classification
• Tax withholding requirements
• Payment documentation

M-Pesa for Business Payments

When to Use

• Small supplier payments
• Service provider payments
• Quick, informal transactions

Limits

• Transaction limit: KES 150,000 (~$1,200)
• Daily limit: KES 300,000 (~$2,400)

How to Send to M-Pesa Business

1. Use Sendwave or similar
2. Send to Till Number or Paybill
3. Or send to individual, they pay business

Setting Up Regular Supplier Payments

Steps

1. Verify supplier bank details
2. Open business account with Wise or OFX
3. Set up recurring payment or batch
4. Document each transaction

Rate Alerts

Set up alerts for favorable rates:

• Wise: In-app rate alerts
• OFX: Email alerts
• XE: Rate notifications

Common Challenges

1. Incorrect Bank Details

Solution: Always verify with supplier before first payment. Kenyan bank details format differs from Western banks.

2. Slow Processing

Solution: Use Wise or OFX for faster processing. Bank wires can take 5+ days.

3. Hidden Fees

Solution: Ask for total cost upfront, including intermediary bank fees.

Conclusion

For business payments to Kenya:

1. Wise Business for most regular payments
2. OFX for large amounts with custom rates
3. Avoid bank wires and PayPal for routine payments
4. Document everything for tax compliance
5. Verify recipient details before first payment

Compare business payment rates with our calculator.