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