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Uganda folows suit to stop use of Kenyan currency

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BY KORIR JUMA,NAIROBI,11TH JUNE 2019-East African community countries continue to  ban usage of Kenyan currency following the unveiling of the new bank notes in a move aims at curbing money laundering . On Tuesday Uganda became  the latest member of the East African Community (EAC) after Tanzania to stop the use of the Kenyan currency in an effort to stop its banks from being used to launder stolen money back into Kenya.

The move follows  the Central Bank of Kenya (CBK) announcement that it will be  withdrawing  the old Sh1,000 notes from circulation to combat illicit financial flows and counterfeits.

The Bank of Uganda says the move was necessitated after the CBK informed it that it had issued a new series of banknotes effective May 31. The CBK also suspended currency conversion and repatriation of Kenyan currency.

“In light of the new development, the Bank of Uganda (BoU) will not accept Kenya shillings at its counters with immediate effect,” a letter to commercial banks in the country reads.

BoU advised Ugandan banks to subject all flows from and into Kenya to enhanced due diligence, noting that changing Kenyan currency from old to new banknotes can only be done in Kenya.

Tanzania took a similar action on Friday last week in what will force Kenyans living in the neighbouring countries to return home to exchange Sh1,000 notes or risk losing their money.

CBK announced that the old Sh1,000 note will cease to be legal tender from October 1.

It has also introduced new notes of Sh500, Sh200, Sh100 and Sh50, which will operate parallel to the old ones.

 

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