Kenya stands as a prominent digital centre in Africa, contributing 7.7% of its Gross Domestic Product (GDP) through its digital economy. According to the United Nations Development Programme (UNDP), this sector is among the fastest growing in East Africa and is expected to add KSh. 1.4 trillion, or 9.24% of GDP, to Kenya’s economy by 2025.

Kenya has built a notable reputation as a reliable partner in digital transformation for its people and the region. The country is known for its rapid digital development and groundbreaking innovations, such as mobile money services, which have bolstered digital financial inclusion. Additionally, efforts are being channelled towards improving the information and communication technology (ICT) infrastructure, providing better connectivity, and ultimately remaining at the forefront of ICT innovation. 

The government has prioritised digitisation as part of the Bottom-Up Economic Transformation Agenda, focusing on five pillars: digital government, digital business, infrastructure, digital entrepreneurship, and digital skills and values. To achieve this, the government has committed to adding 100,000km of fibre-optic cables, establishing 25,000 free Wi-Fi hotspots in market centres across Kenya, and creating 1,450 digital hubs in every ward. These investments aim to provide high-speed internet access nationwide, easing access to public and private digital services.

But despite these efforts, Kenya still lags in global digital GDP rankings due to a significant digital divide. This divide is primarily driven by disparities in technology access, socioeconomic factors, and infrastructural challenges. Rural and remote areas often lack adequate internet connectivity due to insufficient investment in telecommunications infrastructure, leading to a stark contrast with urban centres that enjoy better access. The costs of internet services and digital devices further exacerbate this divide, making it difficult for lower-income households to afford them. Additionally, many individuals lack the necessary digital literacy skills to use digital tools and platforms effectively. These factors combined prevent large segments of the population from fully participating in the digital economy.

With 38% of the Kenyan population living in poverty, the use of digital infrastructure is often determined by cost and affordability. The UNDP notes that Kenya’s mobile and fixed broadband data access costs are among the highest in East Africa. The price of airtime, data, and technological devices often affects individuals’ decisions to take up digital services. 

Currently, one proposed solution under consideration by the National Assembly is addressing the high cost of data through the introduction of policies that would regulate internet billing based on consumption rather than a flat fee. Traditionally, internet billing in Kenya has involved a flat fee for a fixed amount of data. With metered billing, users only pay for the data they use, which could be cost-efficient for low users. This model allows individuals or households with minimal data usage to save money compared to flat-rate plans that charge a fixed amount regardless of usage. Additionally, users can have more control over their internet expenses by monitoring data usage and adjusting their online habits to avoid exceeding data caps and incurring overage charges.

However, such a model is not without drawbacks. One major issue is the unpredictability of costs, which can discourage users from fully utilising internet services and hinder their overall digital experience. Managing and understanding data usage can be complicated for some users, leading to confusion and potential disputes with ISPs over billing inaccuracies. Moreover, metered billing may exacerbate the digital divide, particularly among low-income individuals, as those who cannot afford high data costs may have limited access to essential online services, further entrenching social and economic inequalities.

The merits and drawbacks of internet billing per consumption should be weighed carefully. In highly competitive markets, this model might drive innovation and better pricing strategies. Conversely, it could result in higher prices and less favourable terms for consumers, widening the digital divide. While the model offers cost control for some users, we run the risk of overages and an exacerbation of the digital divide. Policymakers ought to explore other strategies to address cost issues, such as reducing tariffs and taxes. Other potential solutions include subsidising internet access for low-income individuals and investing in digital literacy programmes. By addressing this, Kenya can work towards a more inclusive digital economy that benefits all its citizens.