This archive report was first published on 3 October 2019.
On October 3, 2019, Kenya replaced its old currency notes with new ones, marking a significant change in the country's financial landscape. The transition was largely smooth, with few reports of queues or disruptions.
However, the ease with which the old notes were phased out has raised eyebrows, with some speculating that they were used to stash illicit funds. According to reports, the Central Bank of Kenya reached out to the Judiciary to ensure that any currency kept in the courts system as exhibits was converted after the necessary procedures.
Kenya's experience stands in stark contrast to India's 2016 demonetization, which was marred by chaos and long queues. The Indian government's decision to withdraw 500 and 1,000 rupee notes from circulation led to widespread disruptions, with many people struggling to access their cash.
Kenya's smooth transition has sparked speculation about the fate of the old notes. Some have suggested that they were used to stash illicit funds, while others have pointed out that the country's financial system is more robust than India's.
One theory is that the old notes were used to hide money from the taxman, with some individuals allegedly stashing large sums in hidden rooms and ceilings. Others have claimed that the notes were used to fund extortion rings and kidnap for ransom operations.
While these claims are difficult to verify, they highlight the complexities of Kenya's financial system and the need for greater transparency and accountability.
As Charles Onyango-Obbo noted in his article, 'The Central Bank of Kenya... also reached out to the Judiciary to ensure that any currency kept in the courts system as exhibits has been converted, after the necessary procedures'. This level of coordination and planning is a testament to the country's ability to manage change and ensure a smooth transition.
Ultimately, the fate of the old Kenya shilling notes remains a mystery, but one thing is clear: Kenya's financial system is more resilient than ever.
Charles Onyango-Obbo is the curator of the Wall of Great Africans and publisher of explainer site Roguechiefs.com. @cobbo3
