Trouble at Central Bank of Kenya regarding issuance of new bank notes

On 1st June during Madaraka Day celebrations CBK Governor Dr. Patrick Njoroge launched the new bank notes and went ahead to assure Kenyans that the CBK is ready to supply the new bank notes in the whole country. According to the Governor, CBK had printed enough notes that will also be issued to the commercial banks to issued in exchange of the old notes which are supposed to be withdrawn from circulation by October 1st.

Since then everyone has been racing against time to make sure that the deadline doesn’t catch up with them. Sadly it has not been all rosy especially for the commercial banks. Many commercial banks are still issuing the old generation notes through their 1700 ATM machines, 780 Commercial bank branches and about 66000 bank agents countrywide. Remarks made by these commercial banks claims that they don’t have enough new currency to dispense. This is why most banks in the country have not fully configured their ATM machines to dispense the new currency. Mr. Olaka Habil, C.E.O of Kenya Bankers Association (KBA) affirmed that the banks were experiencing temporary shortages. He said that they would be fixing the hitch as soon as CBK supplies them with new currency.

Now here is the problem, the CBK has refused to issue a notice concerning the shortage of new currency notes. This has made the banks to start re-issuing the old notes as their last resort due to confusion raised by the CBK. Another problem that is sprouting is that the old currencies are being reintroduced in the country. With the CBK aim at removing all the old currency generation especially the sh1000 notes this will be a difficult task. The deadline for circulation of the sh1000 notes is looming. How will the CBK able to demonetize all the sh1000 notes.

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Everyone is busy spending the old sh1000 notes and others are trying to exchange as authorized. The banks are experiencing shortage in the new generation notes circulation. This makes the exchange a hectic task. It is a total confusion not only for the citizens but also for the banks. Will CBK extends the deadline so as to make new notes circulation enough or what? For now we wait CBK’s response towards these claims.

See also: CBK Insists deadline for the old shs 1000 notes is as stated

 

Adrian Opiyo

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