This archive report was first published on 25 September 2019.
As the deadline to exchange old 1,000 notes for new generation notes draws near, the Central Bank of Kenya has heightened its anti-money laundering checks to prevent illicit funds from entering the formal financial system.
According to Central Bank Governor Dr. Patrick Njoroge, banks are strictly observing the Anti-money laundering and Counterterrorist financing rules to ensure that no illegal funds enter into circulation.
Speaking during a media briefing, Dr. Njoroge praised Ugandan and Tanzanian financial authorities for their support during the demonetization process, noting that the two neighbors worked closely with Kenya's Central Bank to ensure a smooth transition.
Uganda and Tanzania have already completed their conversions and repatriated their holdings of the old KSh 1000 notes, the governor added.
As of the end of August, conversions above KSh2 million amounted to 24 transactions, with an average value of KSh3.1 million, Dr. Njoroge revealed. However, he noted that most of the conversions had comprised small amounts.
Over the past three months, the Central Bank has engaged in extensive public awareness campaigns to inform people about the pending demonetization of the old 1,000 notes, including social media campaigns, posters sent to public primary schools, and information sent to commercial banks and money agents throughout the country.
CBK officials have also reached out to prison officers and judicial officers to ensure that old notes in prisons and court exhibits are converted into the new generation notes before the deadline.
Contrary to expectations, Dr. Njoroge revealed that 53% of the conversions had already taken place in June, shortly after the announcement on the demonetization on 1st June 2019.
