Kenya: Central Bank licences two remittance providers
The two companies received their operating licence on January 1st.The Central Bank of Kenya has licensed two new money remittance service providers on January 1st, namely Hodan Global Money Remittance and Exchange and Tawakal Money Transfer Ltd.
In Kenya, there are now 13 companies operating money transfers to and from abroad. The two firms were formerly forex bureaux, a trend bound to gain popularity as more convert their business models under new regulations, according to newspaper The Star.
"We converted because money remittance incorporates foreign exchange trading. We can thus offer extra services and reach potential markets," Abdulrazaq Bottan, chief executive of Hodan Global, told the newspaper.
The regulations - which came in force earlier in April 2014 - are meant to prevent terrorism financing under the anti-money laundering framework, as well as reduce barriers and transaction costs.
They include an increase of minimum core capital required for money remittance providers from Sh10 million (€93,130) to Sh20 million.
Kenya's remittance inflows from the diaspora increased to $1.29 billion (€1.10 billion) in 2013, from $1.17 billion in 2012, a 10.3 per cent growth. In 2015, remittances to sub-Saharan Africa are expected to reach $34 billion, according to World Bank estimates.