CBK announces new directive on mobile money transactions

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The Central Bank of Kenya (CBK), on Thursday, April 1, announced the resumption of charges for transactions above Sh 100 for Savings and Credit Co-operative Societies (SACCOs) through a bank’s individual mobile money wallet.

This payment method enables a financial institution to integrate its financial services with other banks.

The bank money wallet is closely connected to the credit societies sector.

This comes as a relief to SACCOs as they facilitate loams for a membership need for short-term capital and lack alternatives to link with the mobile money ecosystem.

The resumption of charges will serve as an incentive for financial institutions to give support to SACCOs as they provide an essential bridge to the domestic and cross-border payment systems.

This move will also provide space to increase the connection options for SACCOs and will be reviewed.

“The resumption of the charges will be subject to review by CBK against pricing principles announced on December 17, 2020, of customer-centricity, fairness and equity, transparency and disclosure, choice and competition, and affordability,” the statement read.

The principles hope to support the development of a safe, efficient, and stable payments and mobile money ecosystem which protects the customer and public interests.

In a bid to cushion Kenyans against the economic effects of the Covid-19 crisis, the charges had been waived last year.

Banks in the country deploy two types of mobile banking wallets; in the first wallet, banks partner with payment service providers to develop their mobile money wallets in order to provide a variety of transactions via customers’ bank accounts.

In the second, they invest directly in their own in-house mobile banking wallets to ease mobile money and other wallet-based financial services.

CBK will keep on monitoring developments and support the growth of the payments ecosystem to ensure choice, affordability, and competition.

The measures announced by CBK were expected to expire on June 31, 2020, but were extended until December 31, 2020, after a review.

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