Kenya Kwanza is mulling an increment of the bank transaction limits that require disclosure to Sh10 million from the current Sh1 million.
The Star has established that the matter was canvassed at length during the party’s parliamentary group meeting in Naivasha last weekend.
In what could spell trouble for Central Bank of Kenya boss Patrick Njoroge, sources indicated that the team could go after the governor whom they blame for instigating the restrictions.
During the campaign, President William Ruto’s side vehemently fought the restriction saying it was to blame for the cash constraints in the economy.
The thinking in Kenya Kwanza is that the current governor has been forming policies, which are anti-businesspeople in Kenya.
The team also feels that the current CBK boss has discouraged savings in Kenya following the difficulties of withdrawing money at will.
The push has been accelerated after the governor indicated that the Central Bank may not abandon the measure, which was meant to help curb money laundering.
In a session with MPs, Njoroge said CBK does not see the disclosure requirement as a limit, adding that the bank is already seized of the concerns.
“We don’t think of it as a limit. This is something we as CBK are working on to improve. It is not working as intended as it is being used to punish,” Njoroge said.
“We are putting some sanity there. We need to do it correctly because we don’t want to undo some of the things that have helped us.”
The CBK boss said it is the issue of customer pain points that needs to be dealt with.
“We have done some work and we hope to see the benefits going forward,” he said adding that banks should see to it that they know their customers better.
In his inauguration speech, Ruto reported concerns of traders who have complained about “the onerous burden involved in cash transactions exceeding Sh1 million.
He said many have reverted to storing money under their mattresses at great risk, which is clearly not the intention of the anti-money laundering regulations.
Kenya Kwanza feels that the anti-money laundering rules are prohibitive, further questioning why they are not strictly applied in European countries where the rich, including Kenyans, make large deposits.
“While we remain fully committed to mitigating this risk, we believe that there is scope to make compliance less burdensome on genuine business transactions,” Ruto said.
“I have been assured by the Central Bank that work on how to ease this burden without compromising the security of the financial system is underway.”
But it seems there is more to it than just the ensuing talks, if the conversation that featured at the MPs’ induction is anything to go by.
MPs at the meeting took on Governor Njoroge, who was present, accusing him of stifling the economy through the stringent policies, which were put forth to curb money laundering.
Imenti Central MP Moses Kirema, without mincing words, said they feel that the governor is not the best to help deliver the Kenya Kwanza agenda.
“This is the wrong governor for this economy and we need one who can implement the hustler nation’s plans,” the MP said.
“He is killing the small business people in Kenya. There are MSMEs that are not big but operate businesses whose figures surpass the limit.”
Kirema said the challenge with restrictive withdrawals is that it “discourages savings and deprives the government money to work with to spur development.”
“Our people have been operating with large amount of money. Is it not discouraging our people from saving as they are keeping money in their houses,” he said.
Kenya Kwanza says the money laundering excuse does not hold as the same can be investigated and nipped in the bud by investigative agencies.
It would be interesting to watch how the push pans out, the same having failed in former president Uhuru Kenyatta’s administration.
Uhuru promised to review the cap but his plans ran into headwinds. It is believed there are powerful external forces behind the financial disclosure caps.
(Edited by Bilha Makokha)