More than 7bn Kenya shillings now just ‘bits of paper’

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More than 7bn Kenya shillings now just ‘bits of paper’

10:02 CAT | 03 Oct 2019

The old notes are no longer legal tender. [File photo: Getty]

Kenya’s central bank says nearly 210 million – or more than 95% – of old 1,000 shilling ($10; £8) notes have been returned in an exercise aimed at curbing corruption and money laundering.

“This means 7.3bn shillings became worthless pieces of paper,” bank governor Patrick Njoroge told journalists.

The bank said there had been about 217 million of the notes in circulation on 1 June, when the decision to phase them out was announced. The notes ceased to be legal tender from 1 October.

A total of 3,172 suspicious transactions were flagged during the demonetisation period and would be investigated by relevant government agencies, Mr Njoroge said.

The demonetisation aims to curb illicit financial flows. According to the Africa Tax Justice Network, Kenya has been losing $400m every year since 2011 through illicit financial flows.

The bank posted a tweet to declare the demonetisation successful.

Governor @njorogep: Demonetisation has been successful because we have completed it smoothly, with AML/CFT filters firmly in place, and kept out money whose owners did not want to be subjected to the relevant checks in the system.

— Central Bank of Kenya (@CBKKenya) October 2, 2019