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THE LAUNCH OF THE NATIONAL PAYMENTS STRATEGY BY C.B.K
Published On: 2022-02-23
On 23rd February 2022, KEPSA CEO Ms. Carole Kariuki participated in the launch of the National Payments Strategy 2022-2025 by Central Bank of Kenya (CBK), in an event that brought together representatives of key domestic, regional and international institutions that are connected to the payments space. The Chief Guest was Dr. Julius Muia, CBS, Principal Secretary National Treasury and Planning.
Keynote addresses were also delivered by Dr. Alfred Hannig, Executive Director Alliance for Financial Inclusion (AFI), Mr. Agustín Carstens, General Manager Bank for International Settlements (BIS), Mrs. Malangu Kabedi-Mbuyi, Governor Banque Centrale du Congo, and Chairperson, Association of African Central Banks (AACB); and Dr. Patrick Njoroge, Governor Central Bank of Kenya. Several Governors, Deputy Governors, and senior officials of Central Banks in the region also attended the event virtually.
While Kenya’s leadership on mobile money is widely acknowledged, much more remains to be done. The Strategy seeks to consolidate the gains made so far and marking out the path towards a new chapter in Kenya’s payment journey. Since the advent of mobile money almost two decades ago, Kenya has achieved important milestones in its journey of modernizing and strengthening the payments system. While cash remains an important means of payment, Kenyans make over 37.6 million transactions of about Ksh.176 billion every day through various non-cash channels—mobile money, cards, electronic bank transfers, and cheques.
The National Payments Strategy seeks to realize the vision of “a secure, fast, efficient and collaborative payments system that supports financial inclusion and innovations that benefit Kenyans.” This vision is anchored on five core principles—trust, security, usefulness, choice, and innovation. The Strategy builds on the foundation already in place and provides a framework to deliver key initiatives, including: full-scale interoperability; fostering customer-centric innovation; and supporting the emergence of a 24/7 economy.
Speaking at the event Ms Tamara Cook, CEO Financial Sector Deepening (FSD) Kenya, noted that while Kenya has made significant gains since 2009, there’s still more that can be done to make sure that shared access to cash in and cash out is available to everyone faster. The Governor, Central Bank of Congo and current chair of the Association of African Central Banks, Mrs Malangu Kabedi Mbuyi on her part said that innovation in payment systems has been rapid and constantly evolving with several countries modernizing their payment systems to expand access to financial services and improving living standards for their populations.
Joining virtually, Dr. Alfred Hanneke, the Executive Director of the Alliance for Financial Inclusion emphasized that this strategy is testament to the bold steps that have been taken over the years to increase access to financial services in Kenya.
Agustin Carsten, General Manager of Bank of International Settlements (BIS), also noted that for the last two decades the Central Bank of Kenya has been a pioneer in the field of digital payments, and its experience has served as an international inspiration in other countries.
The host, Governor of the Central Bank of Kenya, Dr. Patrick Njoroge, in his speechopined that while anthropologists might find reason to dispute Kenya’s claim to being the Cradle of Humanity, its claim as the Cradle of FinTech is hard to challenge. From the starting point of a simple money transfer innovation, he observed, an elaborate financial services ecosystem has emerged.
Dr. Julius Muia, CBS, Principal Secretary National Treasury and Planning, began by reflecting back to the mid-1990s, when the clearing processes and the settlement processes used to take several days. Indeed, he noted, Kenya has come a long way with the adoption of a paperless system that allows payments to be done in real time. Dr Muia commended stakeholders for their consistency and faithfulness in the journey of modernizing relevant policies including the review of the Central Banking Act 491, which happened in 2003 to include a new section where the objectives of Central Bank were properly spelled out. The CBK acknowledged with gratitude the support and extensive feedback that it received from the payments industry, other stakeholders and members of the public in developing the Strategy. This broad-based support will be important for a successful implementation.