The Central Bank Governor Dr. Patrick Njoroge who was appearing before the Parliamentary Committee on Finance and National Planning said 99.3% of the accounts in the nation have less than KSh 1 million.
While defending the non-implementation of section 33C of the Banking Act, he noted Kenyans willingly report on any transactions as per the regulations, Citizen TV reported.
“This law was contradicting many regulations, it was impossible to implement it, it was un-implementable,” said Njoroge.
The CBK boss on Tuesday, February 26, emphasized on the importance of reporting on cash transactions noting, if removed, there would be immediate and severe consequences.
These would include the risk of Kenya being locked out of the global financial system, a move whose effects he termed as adverse.
“The requirement to report any transactions above $10,000 (KSh 1 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 said.
Njoroge also said the country is particularly vulnerable because of its geography, advanced banking and financial sector as well as its characteristics of a largely cash-based economy.