This study focused on the relationship between the use of mobile money transfer and cash transaction cost. Despite the fact that mobile money transfer systems may not be designed primarily as a means of cost reduction, evidence of the research shows that it actually contributes to the reduction of the same. The study aimed at establishing the extent of mobile money transfer use by NGOs operating in Kisumu Central sub county and the relationship between the use practice and transaction cost reduction. To achieve the objective, a descriptive study was done. The researcher used primary data. The respondents constituted 116 Finance contact persons, 29 administrators and 29 Head of audits in 119 organizations. The study adopted descriptive statistical techniques such as frequency, percentage, and mean distribution. The data was presented using frequency tables. The study concluded that there is significant positive correlation between adoption of mobile money transfer and cash transaction cost reduction in the NGO sector. The study recommends that future researches should narrow down to the individual indicators for more in-depth understanding. The study also recommends that future studies should consider other variables of cash transaction costs as research zeroed only on six of them.

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