The cash is believed to have been sent via a mobile phone transfer on Monday .
The inmate at the King’ong’o GK Maximum Prison in Nyeri allegedly argued with his cellmate over how to split up the cash before he was struck on the head with a hammer and killed.
Sources told Baraka FM the inmate accused of killing his cellmate is serving a jail sentence for committing robbery with violence.
The deceased inmate was also serving a time in prison for a rape charge.
Nyeri police are investigation the killing.
The incident is expected to spark a public debate following reports that prisoners have fraudulently been using mobile phone transfers while in prison to con people of millions of shillings.