The Kenya Bankers Association (KBA) yesterday issued a public statement cautioning Kenyans against money laundering as people who have hoarded cash try to beat Central Bank Of Kenya (CBK) deadline of 1st October, 2019 for exchanging old bank notes with new ones.
KBA also urged Kenyans not to wait till the deadline so as to exchange the old bank notes for the new ones stating that banks have already started calibrating their system to the new currency.
Below is their full statement in full text.
KENYA BANKERS ASSOCIATION STATEMENT ON NEW GENERATION BANK NOTES
The Central Bank of Kenya (CBK) has commenced the introduction of the new generation bank notes. The CBK advised the public and industry about the transition to a new currency — most recently in October 2018 — and commenced with the issuance of the redesigned 1, 5, 10 and 20 Shilling coins in December 2018. Therefore, the release of the new 50,100, 200, 500, and 1,000 Shilling notes is the second phase of the country’s transition to the new currency.
Banks have anticipated this transition and have in place the mechanisms to receive the old notes and provide their customers with the new currency. The process will include reconfiguration of ATM machines and currency counters, and coordination with the Central Bank in Nairobi, as well as, the Currency Centers in Meru, Nyeri and Nakuru which are operated by the Central Bank in coordination with the Kenya Bankers Association.
There are approximately 1,700 ATM machines; 780 branches; and 66 thousand bank agents country wide. We anticipate banks will have a structured replacement program that will ensure minimal disruption of regular services.
Members of the public are encouraged to use this period to exchange their old notes for the new currency. Customers should not wait until the 1st of October 2019 deadline.
We also encourage banks, bank agents and retailers, as well as citizens in general, to be especially vigilant during this period as there may be attempts to launder illicit funds through the banking system during the exercise of replacing the old generation notes with the newly released ones.
Because of the critical role banks play in an economy, the banking industry is the most regulated of sectors and as such banks must comply with numerous laws and industry regulations. These requirements include the Central Bank of Kenya (CBK) Risk Management and Prudential Guidelines, and Kenya’s Proceeds of Crime and Anti-Money Laundering Act (POCAMLA), 2009. Under these legal requirements, banks have and continue to undertake their due diligence processes seriously and report suspicious transactions to the Financial Reporting Center as required. Therefore, during this period, customers are requested to cooperate with the industry regulatory requirements, particularly for cash deposits in excess of Kes. 1 million.
As always, the banking sector supports actions that the Government and Central Bank of Kenya undertake to ensure the stability and integrity of our financial system.