Central Bank of Kenya building in Nairobi/ Courtesy
NAIROBI, Kenya Dec 1 – Kenya is set to revise the Sh1 million threshold for cash deposits and withdrawals in banks.
Speaking in Parliament during the state of the nation address, President Uhuru Kenyatta said that the Central Bank of Kenya is at an advanced stage of revising the one million threshold.
“This will facilitate easy transactions for Micro Small and Medium Enterprises and help the economy respond to the COVID shocks,” he said.
Currently, the law requires bank customers to disclose source, intended use and beneficiaries when depositing and withdrawing cash of more than Sh1 million.
Financial institutions are also required under the law to keep records of cash transactions of more than Sh1 million and report suspicious deals to the Financial Reporting Centre (FRC) – the agency tasked with identifying and combating money laundering and financing of terrorism.
Businesses and individuals transacting more than Sh1 million are also required to declare to their bankers why the money cannot be deposited or withdrawn through electronic means — Kenya Electronic Payments and Settlement System and Real Time Gross Payment System.
“As the Eleventh Intent, I also asked the National Treasury and Central Bank of Kenya to consider revising the maximum amount an individual or enterprise can withdraw or deposit from a bank. Previously, it stood at one million shillings, which was not supportive of our current business environment,” President Kenyatta noted.
“I am also happy to report that the Central Bank of Kenya is at an advanced stage of revising the one million threshold for cash deposits and withdrawals in the banks.”
The move comes even as the FRC is pushing for more businesses and professions to be added in the list of entities with reporting obligations.
Some of the entities targeted include lawyers, second hand car dealers and trusts holding assets for high net worth individuals.
Lawyers are targeted in property transactions, bank accounts management, company acquisitions and setting up of businesses.
