This archive report was first published on 30 June 2021.
June 3, 2019, marked the launch of new-generation currency notes in Kenya, a move aimed at reducing wear and tear. However, the Central Bank of Kenya (CBK) has now attributed the worn-out state of these notes to 'bad handling habits' of the public.
CBK Governor Patrick Njoroge appeared before the Senate Committee on Finance and Planning to address concerns over the quality of the new currency. He reaffirmed his confidence in the new notes, stating that they are 'technically superior' to the old ones.
The new banknotes feature a varnish to reduce wear and tear, have a significantly longer lifespan, and are designed to last one year compared to the old-generation banknotes that lasted six to nine months.
However, Nominated Senator Rosa Nyamunga expressed concerns over the quality of the currency notes, particularly the Sh50 denomination. She suggested that the public's handling of the notes, especially in transactions such as matatu fares, contributes to their wear and tear.
CBK Governor Njoroge acknowledged that the public's destructive testing of the notes, which involved crumbling them to see what happens, has also contributed to their worn-out state. He stated that following the launch of the new-generation notes, many people engaged in this destructive testing.
Senator Nyamunga also attributed the mishandling of the currency notes to poverty, with some individuals crumpling and hiding them in pockets and knots in clothes.
She urged the CBK to boost the quality of the notes to reduce the expense of printing new ones.
During the rollout of the new-generation currency notes in 2019, the government invested Sh15 billion. The CBK also used an additional Sh833 million in currency generation in the financial year 2019/2020 compared to Sh2.3 billion used in the financial year 2018/2019.
