MPs give CBK governor 14 days to publish law on Sh. 1 million cap on bank transactions.

The National Assembly has given Central Bank Governor Dr. Patrick Njoroge a 14-day ultimatum to draft and submit banking regulations prescribing customer deposits and withdrawals worth a Ksh. million shillings or more.

The House committee on Implementation chairman, Motalel Ole Kenta, has warned that the governor of unspecified sanctions should he fail to submit the regulations before the committee in two weeks.

Last week, the MPs warned that his failure to publish the banking regulations as provided for in the Banking Act, which was amended in August last year through the Finance Act, was contemptuous of parliamentary proceedings and reason enough to send the governor home.

The Finance Act mandates the CBK boss to publish the regulations and submit them to the National Assembly within 30 days of its coming into force for consideration, in line with the Statutory Instruments Act.

The MPs have expressed their concerns about new conditions on bank transactions worth Ksh 1 million or more noting that it was an obstacle to economic development.

In June last year, the central bank published regulations informing banks that customers seeking to withdraw or deposit more than Ksh 999,999 would need to submit a three-day notification about the transaction.

When he appeared before the committee last month, Dr Njoroge defended his actions, saying, the law as it is could not be implemented as it would be akin to relaxing money laundering and terrorism laws.

He also warned that doing so would frustrate the war against corruption and cut off Kenya’s banking sector from the best practices in the global banking system like Financial Action Task Force (FATF).