Majority of Kenyans have less than Sh1 million in their bank accounts, Central Bank of Kenya (CBK) Governor Patrick Njoroge has revealed.
Njoroge has revealed this while appearing before the Parliament's Finance and National Planning Committee on Tuesday. He says 99.3 percent of bank accounts in Kenya have less than Sh1 million.
Njoroge has also defended banking regulations on cash transactions exceeding Sh1 million.
He says the tough rules are in line with the Global Anti-money Laundering regulations.
Njoroge further says attempts to remove the regulations guiding bulk transaction will have serious implications on the country since Kenya would be cut off from the international financial fabric.
''Consequences of doing away with anti-money laundering are harsh. Kenyan banks will be blacklisted in the international market with international banks operating in the country recalled. Kenya will be regarded as a safe haven for money laundering,'' Njoroge says.
He has dismissed claims by MPs that some aspects of the Banking Act that took effect on October 1st, 2018 are illegal.
He says the changes introduced to the Act followed all the laid out procedures as required by law.
''We remain vulnerable to money laundering and terrorist financing due to our geographical location. We, therefore, have a task to ensure illicit financial flows are not happening via our financial institutions,'' Njoroge explains.
“The requirement to report any transactions above USD 10,000 (Sh1 million) or equivalent are contained in the requirements and provisions of the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA) which was effected in 2010,” he adds.
Under the regulations, CBK requires those depositing or withdrawing more than Sh1 million to disclose why the huge transaction is necessary, the source of the funds and full identities of the direct and indirect beneficiaries among other details.