Kenya’s National Treasury has been directed to increase the threshold for the reporting of cash transactions with the Financial Reporting Centre (FRC) from the current Ksh 1 million (USD10,000).
The directive from President Uhuru Kenyatta will be applicable to both withdrawals and deposits by bank customers.
According to the president, the current reporting framework has not been facilitative of the operations of micro-small and medium enterprises (MSMEs) and has to some extent inhibited their growth.
“Cash remains an important payments channel for medium, small and micro enterprises, representing 80 per cent of all their transactions,” President Kenyatta said.
He was speaking on Wednesday during the 58th Mashujaa Day celebrations held in Kirinyaga County.
“However, Banks and Other financial institutions will retain the financial reporting obligations to the Financial Reporting Centre,” he added.
In Kenya, financial institutions are required to declare all cash transactions above Ksh.1 million ($10,000) with the FRC in accordance with provisions of the Proceeds of Anti-Money Laundering Act (POCAMLA) which was effected in 2010.
President Kenyatta further said Kenya’s Banking sector has made huge strides resulting in the country being seen as East Africa’s Financial Hub due to efficiencies secured by technology.
“The gains made in the digitization of financial processes and transactions have made it possible to better track and trace the illicit flow of cash,” said President Kenyatta.
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