M-PESA Paybill charges for businesses 2026: who pays

Paybill charges are split between customer and merchant, and the split depends on how your specific paybill is configured. Customer-pays paybills apply the standard M-PESA send tariff (up to KES 108) to the customer and a low or zero merchant fee. Business-pays paybills absorb the customer send fee and charge the merchant a negotiated per-transaction fee instead. This is the single most important decision when you launch a paybill because it directly shapes conversion. (Source: Safaricom M-PESA Consumer Tariffs and Limits, verified August 2026.)

The two paybill fee models

	Customer-pays paybill	Business-pays paybill
Customer fee	Standard M-PESA send tariff, up to KES 108	KES 0
Merchant fee	Low, often KES 0 to KES 20 per transaction (negotiated)	Higher, negotiated (absorbs the customer side too)
Typical use	Utilities, schools, SACCOs, government	Insurance, subscriptions, high-value fintech
Conversion impact	Customers see a fee at the till, small drop-off	Customer sees zero fee, cleaner UX

Customer send tariff bands (2026)

For customer-pays paybills, the customer pays the standard M-PESA send tariff. Safaricom publishes the current bands on their Consumer Tariffs page. The 2026 pattern: free below a small threshold (around KES 100), rising through a series of bands to a maximum of KES 108 for the top bracket at KES 250,000. Because the bands are updated periodically, this guide does not print a static table. Use the M-PESA cost calculator for the current figures. (Source: Safaricom M-PESA Consumer Tariffs and Limits, verified August 2026.)

Paybill vs Buy Goods: the honest comparison

Tills win on customer experience for retail because the customer pays zero. Paybills win on account-referenced payments because they carry a customer reference (invoice number, student ID, meter number). The economics diverge as follows:

	Buy Goods (till)	Paybill
Customer pays	KES 0	Up to KES 108 (or zero if business-pays)
Merchant pays	Approx 0.55%, capped at KES 200	Negotiated, KES 0 to KES 200+ depending on structure
Account reference	No	Yes
Fit	Retail, in-person	Utilities, subscriptions, invoiced services

The full decision guide is in Paybill vs Buy Goods charges and the Tier 1 pillar, M-PESA Business Account Explained.

Worked examples: KES 500, 5,000, 50,000

Illustrative fees using the current pattern for a customer-pays paybill:

Transaction	Customer send fee	Approx merchant fee	Total cost
KES 500	KES 7 (approx)	KES 0 to KES 5	Approx KES 12
KES 5,000	KES 28 (approx)	KES 0 to KES 10	Approx KES 38
KES 50,000	KES 105 (approx)	KES 0 to KES 20	Approx KES 125

These are illustrative. Confirm current fees in the calculator before you price. Merchant paybill rates are negotiated so your specific rate card may differ.

How to choose between the two models

Customer-pays when your customers expect to pay a fee (utilities, government, established SACCOs) or when you cannot absorb the cost into product pricing.
Business-pays when the fee visibility is killing conversion (insurance premiums, digital subscriptions, fintech onboarding) or when you have priced the fee into the product.
Buy Goods instead when you do not need an account reference and want the cleanest customer UX.

Related business guides

FAQ

Who pays the fee on a paybill transaction?

It depends on how the paybill is configured. Two structures exist. Customer-pays paybills apply the standard M-PESA send tariff to the customer (up to KES 108) and a small or zero merchant fee. Business-pays paybills absorb the customer send fee and charge the merchant a negotiated fee instead. The customer experience differs and this decision shapes conversion.

What is the customer send tariff on a paybill in 2026?

For customer-pays paybills, the customer pays the standard M-PESA send tariff which follows a banded structure up to KES 108 for the largest bracket. Small transactions (typically at or below KES 100) are free. Confirm the current bands in the paybillke fees calculator. (Source: Safaricom M-PESA Consumer Tariffs and Limits, verified August 2026.)

What does the merchant pay on a paybill?

Merchant paybill fees are negotiated per paybill and depend on the volume and structure. Rate cards range from a low banded percentage (comparable to Buy Goods) for high-volume paybills, up to a fixed per-transaction fee for smaller ones. Ask your Safaricom Business Account Manager for the current rate card that applies to your paybill category.

How is paybill different from Buy Goods (till)?

Buy Goods is customer-pays-zero, merchant-pays-banded (approx 0.55 percent, capped at KES 200). Paybill splits the cost across customer and merchant depending on configuration. Buy Goods suits retail where the zero-fee customer experience is a conversion lever; paybill suits situations that need an account reference (utilities, schools, SACCOs, subscriptions) and can be tuned on the fee split.

Can I switch my paybill between customer-pays and business-pays?

Yes, but it is a Safaricom-side configuration change that goes through the Business Portal or your account manager. It is not a switch you toggle in the app. Give the change 3 to 5 business days to reflect in production.

Do paybill charges include excise duty?

Yes. The 20 percent excise duty on money transfer fees is baked into both the customer send tariff and the merchant paybill fee. Treat the deduction on your settlement report as the true cost to the business.

What is the typical merchant fee for a mid-size paybill?

Rates vary but many mid-size customer-pays paybills operate at a merchant fee in the range of KES 0 to KES 20 per transaction, depending on the tariff class. Business-pays paybills carry higher merchant fees because they also absorb the customer send fee. Confirm your specific rate card via your Safaricom Business Account Manager.

Verified 1 September 2026. Tariff bands from Safaricom PLC's Consumer Tariffs and Limits page (Source: Safaricom M-PESA Consumer Tariffs and Limits, verified August 2026). Merchant paybill rates are negotiated; confirm your specific rate card with your Safaricom Business Account Manager.