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Legislation and Guidelines

Legislation (or “statutory law”) is law that has been promulgated (or “enacted”) by a legislature or other governing body. Before an item of legislation becomes law it may be known as a bill, and may be broadly referred to as “legislation” while it remains under consideration to distinguish it from other business.

The Central Bank of Kenya is in various ways guided by the following pieces of legislation:

    • Constitution of Kenya 2010
    • Central Bank of Kenya Act (2015)
    • Banking Act (2015)
    • Microfinance Act (2006)
    • The National Payment System Act (2011)
    • Kenya Deposit Insurance Act 2012

Regulations and Guidelines Pursuant to the Banking Act (Cap 488)

Regulations and Guidelines issued by the Central Bank of Kenya subject banks to certain requirements, restrictions and guidelines. This regulatory structure creates transparency between banking institutions and the individuals and corporations with whom they conduct business, among other things.

Given the interconnectedness of the banking industry and the reliance that the national (and global) economy hold on banks, it is important for regulatory agencies to maintain control over the standardised practices of these institutions. The objectives of these  regulations are:

 

  • Prudential—to reduce the level of risk to which bank creditors are exposed (i.e. to protect depositors)
  • Systemic risk reduction—to reduce the risk of disruption resulting from adverse trading conditions for banks causing multiple or major bank failures
  • Avoid misuse of banks—to reduce the risk of banks being used for criminal purposes, e.g. laundering the proceeds of crime
  • To protect banking confidentiality Credit allocation—to direct credit to favoured sectors to provide the best customer service in this competitive age.

Constitution of Kenya 2010 Constitution of Kenya 2010 Central Bank of Kenya Act (2015) Central Bank of Kenya Act 1st Oct 2015 foreign exchange guidelines Forex Bureau Guidelines 2011 – March 18 2011 Forex Bureau Penalty Regulations The Money Remittance Regulations 2013 Banking Act (2015) Banking Act Oct 2015 Microfinance Act (2006) MICROFINANCE ACT 2006 Microfinance Deposit Taking Microfinance Institutions Regulations Microfinance Categorization of the Deposit Taking Microfinance Institution GUIDELINE ON THE APPOINTMENT AND OPERATIONS OF THIRD PARTY AGENTS Guideline on Marketing Offices and Agencies for DTMs The National Payment System Act (2011) NATIONAL PAYMENT SYSTEM ACT (No 39 of 2011) National Payment System Regulations 2014 Kenya Deposit Insurance Act 2012 Kenya Deposit Insurance Act 2012 Prudential Guidelines 2013 PRUDENTIAL GUIDELINES Risk Management Guidelines 2013 risk management guidelines january 2013 Guidance Notes Guidance Note No1 of 2010 GUIDANCE NOTE ON HOLDING OF BOARD MEETINGS THROUGH VIDEO CONFERENCING STR Guidance Note GUIDANCE NOTE ON INTERNAL CAPITAL ADEQUACY ASSESSMENT PROCESS GUIDANCE NOTE ON CYBERSECURITY FOR THE BANKING SECTOR

RBS Framework CBKs Risk Based Supervision Framework – May 2013 KEPSS Rules and Procedures KEPSS Rules and Procedures Guidelines for Application for the Authorisation of Payment Service Providers Guidelines for Application for the Authorisation of Payment Service Providers Schedules to KEPSS Rules and Procedures Schedule A Schedule B Schedule C Schedule D Schedule E Schedule F Schedule G Schedule H CBK (Currency Handling) Regulations 2010 cbk currency handling regulations 2010 Banking (Credit Reference Bureau) Regulations 2013 CREDIT REFERENCE BUREAU REGULATIONS 2013 Guideline on Incidental Business Activities,2013 Guideline on Incidental Business Activities Guideline on Non Operating Holding Companies Guideline Non Operating Holding Companies Over the Counter trading Guidelines For Treasury Bills OTC Operational Guidelines