Kenya: New cheque clearance system will reduce processing time to two days
Cheques will soon be cleared in two days in Kenya, the Kenya Bankers Association (KBA) and the Central Bank of Kenya (CBK) have announced on August 1st.Cheques will soon be cleared in two days in Kenya, the Kenya Bankers Association (KBA) and the Central Bank of Kenya (CBK) have announced on August 1st.
Effective from August 19th, the new cheque clearing cycle is one day shorter than the current three days cycle.
"The shorter clearing cycle will enable customers to know the fate of their cheques faster thus speeding up cheque based transactions and ultimately increasing the flow of funds in the economy," said KBA chairman Jeremy Awori, quoted by The Star.
CBK governor Njuguna Ndung'u added that the continued systematic modernisation of the payment and settlement systems will enable the country's payment system to attain international standards and ensure that Kenya becomes a financial hub in the region.
Cheques no longer have to be physically moved from bank branches to the clearing house as the system involves replacing the physical paper with an electronic image at the bank's branch.
It is expected that
this will greatly reduce the risk of theft and fraud, thus building trust in the banking system and improving access to financial services.