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Money Laundering Tough Laws Approved By Banks.

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The legislators have plans to hold Central Bank of Kenya (CBK) stringent anti-money laundering laws which have now received heavy support from Commercial Banks. Joshua Oigara the Sector lobby Kenya Bankers Association stated that the laws these laws are fundamental when it comes to preserving the integrity of the banking system. “We are behind these rules. We have to protect our financial sector,” said Mr Oigara.

The lenders involved Standard Chartered Kenya, Equity Bank, Diamond Trust Bank and Co-operative Bank, who were penalized for allegedly not following the proper procedures laid out when they aided to transfer Sh8 billion, money that is said to have been stolen from National Youth Service. Oigara says that KCB has already settled the fine and has gone ahead to adjust their internal systems and beefed up its monitoring of transactions.

 

In a statement made last month by Patrick Njoroge the Governor of Central Bank, he opposed the bid by MPs looking to lessen the impact of the anti-money laundering laws, saying that the proposed amendments were going to frustrate the fight against corruption and separate Kenya’s banking sector from global financial systems.

MPs were informed by the CBK boss that the country risks being perceived as a people who embrace money laundering and financing or terrorism if it were to implement the changes proposed by the legislators six months ago. “The adverse effect of the amendment on the banking sector would be immediate termination of relationships by foreign correspondent banks and closure of accounts of Kenyan banks ” he said addressing the National Assembly’s Finance Committee.

According to the laws of Kenya, all financial bodies inclusive of banks, insurance companies and saccos are required to file daily reports with the Financial Reporting Centre for transactions above Sh1 million and anyone who may come across as a suspect. Failure to this, one is liable to pay a fine of Sh1 million and in addition a three-year jail sentence. The fine could go as high as Sh20 million upon convictions and banks risk having their licences revoked. This was strengthened by President Uhuru’s order to toughen new sanctions against any persons and institutions who flout the anti-money laundering laws.

 

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Companies

PMC Estates Limited’s Wonderful Solution that is Easing Landlords’ Stress

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PMC Estates Limited has launched a campaign that is meant to ease stress for landlords

PMC Estates Limited, one of the leading property letting and management companies in Kenya has launched a solution-oriented campaign dubbed ‘Landlord Bila Stress’ which is aimed at partnering with landlords and property owners in helping them to manage their rental properties with much more ease.  The initiative will see landlords take advance rental payments against their managed properties.

“Landlords can now take advantage of this advance payment and direct the funds to any of their priority areas including construction, mortgage or loan repayments or for their personal needs. The advanced funds shall then be recovered over an agreed period of time through rent collections,” says Peter Kariuki, PMC Estates Managing Director.

The firm, which specializes in professional letting and management of both residential and commercial properties in Kenya, has introduced this initiative to further empower investors in properties to grow their wealth through mutual partnerships that will propel social and economic prosperity.

The ‘Landlords Bila stress’ initiative will provide a great opportunity which translates that landlords will no longer have to wait for the month to end in order to access cash. The landlord will also have an opportunity to access more cash than what the property is generating on any given month.

“This PMC Estates solution will offer landlords an opportunity to get customized financing to further help them improve the standard of their property, which will in-turn have a ripple effect on the rental value leading to more income,” says Kariuki.

He notes that PMC Estates shall not only commit to finance facelifts, improvements, repairs and renovations to ensure the landlords earn more from their investment but that the firm will also carry out a thorough inspection of the property to offer the owner, a detailed proposal with budgets on the needed works to be done.

“This is already happening with our current happy landlord partners and we are keen to enlist more property owners to take advantage of this great opportunity,” notes Kariuki.  The company will also be holding Landlord empowerment forums in various satellite towns in the country to sensitize property owners on how they can take up and enjoy the incentives being offered

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Sh1,000 Notes Abroad to be Exchanged in the Country, CBK Says

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Patrick Njoroge, the Central Bank of Kenya (CBK) Governor, has urged those with the old Sh1,000 notes that are out of the country to exchange them in Kenya before the October 1st deadline elapses.

The Governor dismissed permitting conversion of the old currency outside the country, adding that the CBK had alerted all foreign banks to cease recognition of the old notes.

He further said that banks outside the country will not be receiving any new notes to aid in conversion, contending that this would defeat the process of demonetization.

“If you have the Kenyan currency and you happen to be outside the country, there is only one way to get value for it before October 1. You have to take a trip here and go through the procedures outlined in the Gazette notice and subsequent releases,” said Dr. Njoroge when speaking at a press briefing yesterday.

“You cannot convert it to any other currency out there since this would defeat the process of demonetization.”

Earlier this month, notices were issued from the Bank of Tanzania and the Bank of Uganda discontinuing the conversion of the old currency in their banks. In addition, they have directed their countries’ banks to apply more stringent due diligence processes to all currency flows.

The procedures to be followed for currency conversion by locals will also be followed by those coming into the country.

Dr. Njoroge has warned that measures have been put in place to thwart any efforts to clean illicit money in nations involved in significant financial transactions with Kenya.

After the East African Community allowed free movement of goods and people across member states, the Kenyan shilling is frequently used in business transactions in neighbouring countries.

The result is that this money comes back home through those trade routes and official currency repatriation mechanisms between central banks of countries in the Community.

He also said that the deadline will not be extended, arguing that an extension would create a loophole for those seeking to clean their dirty money to do so.

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Safaricom and Equity in Deal to Offer Loans to Contractors

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Safaricom contractors that may find themselves short on cash will now be able to access as much as Sh200 million in unsecured short-term loans following a deal between the telco and Equity Bank. This will help the contractors to maintain cash flow positions before receiving payment for their services.

The firm wrote a letter addressed to its business partners in which it said that the aim of the deal is the creation of a more procurement-ready business. The main beneficiaries will be Safaricom dealers, suppliers, and agents.

In the fiscal year ended March 2019, Safaricom had 440 dealers, 156,000 M-Pesa agents, and 1,164 suppliers.

“We are pleased to inform you of our partnership with Equity Bank which will offer our partners financing solutions linked to purchase orders and invoices,” said Francis Murabula, Safaricom’s head of supply chain management, in the letter.

He is asking the dealers, suppliers, and agents for consent to share their information including contact details, invoice and purchase order information to enable loan processing for potential firms.

Contractors will be able to borrow from Equity before or after they fulfill their contractual obligations with Safaricom.

The terms and amount of the loan applied for will depend on each company’s credit rating.

Therefore, for a contractor to qualify for an unsecured loan of up to Sh200 million, they have to be using unpaid accounts for goods and services that have already been provided to Safaricom as their collateral.

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