Competition in Kenya's payments market is set to intensify with the entry of a new local player, Kenswitch, into the card business. This move gives banks a local alternative to global payment networks Visa and Mastercard. Kenswitch is expanding its role from routing transactions between financial institutions to operating a domestic card scheme for issuing and accepting payment cards.
According to Kenswitch's chief executive, John Mukono, the domestic card proposition is an important step in strengthening Kenya's own payments capabilities. It will give financial institutions an additional platform for domestic card issuance and transactions. The launch comes as Kenya's card payments market continues to expand, with millions of consumers using debit, prepaid, and credit cards for purchases and cash withdrawals.
Central Bank of Kenya data shows that the number of payment cards stood at 13.76 million in July 2026. Debit cards accounted for 11.16 million, followed by 2.26 million prepaid cards and about 341,000 credit cards. Payments made through point-of-sale terminals reached Sh297 billion in 2025. CBK's monthly figures show that POS transactions were worth Sh176.9 billion in the first seven months of 2026, excluding cash withdrawals.
Kenswitch's network currently connects more than 2,200 ATMs, 50,000 point-of-sale terminals, and 80,000 agent outlets. Customers will obtain the cards through participating financial institutions, while Kenswitch is also developing support for contactless payments through smartphones and digital wallets. The company is exploring partnerships with technology firms and device manufacturers to allow customers to load virtual cards onto smartphones and other devices for contactless payments.
The shift towards digital credentials is being driven by the wider adoption of tokenisation, which replaces sensitive card information with a digital token when a transaction is processed. Visa said tokenised credentials recorded a 39.4 percent lower fraud rate than non-tokenised credentials across its global network during its 2025 financial year. Mastercard has also expanded the use of tokenised payments, with almost half of its European e-commerce transactions tokenised as it works towards full tokenisation in that market by 2030.
The Kenswitch Card will use the company's existing payments infrastructure to connect cards issued by participating financial institutions to ATMs, point-of-sale terminals, and online payment channels. However, the domestic card scheme will compete in a market where mobile money already has a much wider consumer and merchant footprint. CBK recorded 94.35 million registered mobile-money accounts and 575,400 active agents in July.
Kenswitch's entry adds another layer to an increasingly competitive payments market, with banks, mobile-money operators, fintechs, and global card networks competing for a larger share of digital transactions. International card networks have also been seeking closer links with Kenya's mobile-money ecosystem, with Mastercard partnering with Safaricom in 2024 to expand payment acceptance and cross-border remittances.
Key points
- Kenswitch's domestic card scheme offers banks an alternative to Visa and Mastercard.
- The Kenyan payments market is becoming increasingly competitive.
- Tokenisation is driving the shift towards digital credentials in payments.
