CENTRAL BANK OF KENYA
3RD NATIONAL BANKING & FINANCE CONFERENCE
KENYA INSTITUTE OF BANKERS
Hotel Inter-Continental, Nairobi
Welcome Remarks by Dr. Patrick Njoroge
Governor of the Central Bank of Kenya
August 6, 2015
As Prepared for Delivery
I am greatly honoured to be here today at this auspicious National Banking and Finance
Conference. At the outset, I wish to acknowledge the presence of Mr. Henry Rotich, the Cabinet
Secretary to The National Treasury. I also wish to thank the Kenya Institute of Bankers (KIB) for
organizing this conference and extending an invitation to the Central Bank of Kenya (CBK).
The theme of this conference — Financial Innovation and Inclusion through Technology — is
quite timely given the ongoing technologically-driven innovations in the Kenyan financial
sector. I am pleased to note that players in the financial sector have embraced the aspirations for
the sector envisaged in Vision 2030, Kenya’s long-term development blueprint. This will ensure
that the sector remains more vibrant and globally competitive going forward. While this
aspiration may not be easy to realise, the achievements so far are encouraging. Allow me to
mention a few of the technologically-driven innovations that mark our success thus far:
1. Mobile Financial Services: The introduction of mobile financial services, which allow banks
to avail their services more conveniently and cost effectively, has not only revolutionised the
delivery channels for financial services, but has also enhanced the satisfaction from utilising
financial services.
2. Agency Banking: The introduction of agency banking by commercial and microfinance
banks has taken banking to the public’s doorstep. Banks save on costs of establishing brick
and mortar branches, while the public saves on travel costs and waiting time. This has been
made possible by the adoption of enabling technologies by banks and their retail agents.
3. Credit Information Sharing: Information asymmetry about borrowers’ credit worthiness has
stifled the development of the financial sector. This challenge is being addressed through the
Credit Information Sharing mechanisms, introduced in May 2010. Commercial banks and
microfinance banks are now able to access the credit history of borrowers on a real time
basis; thus lowering search costs associated with loan appraisals.
4. Cheque Truncation: Clearing a cheque in Kenya now takes a day or two. Prior to the
introduction of cheque truncation, customers in several parts of the country had to wait more
than a week for a cheque to clear.
5. East African Payment System: In order to facilitate cross-border trade in the region, the East
African Payment System was launched in May 2014. This facilitates faster cross-border
transfers of funds in the region by businesses exploiting the expanded business opportunities.

These technologically-driven innovations have not only made Kenya an acclaimed pioneer in
financial services innovations, but has also contributed to an unprecedented increase in financial
inclusion. Today 4 out of 5 Kenyans live within 5 kilometers of a financial access point, which
is certainly a major achievement. Nevertheless, we need to deepen these innovations and support
other countries that are setting out on the same path.
For Kenya to fully reap the benefits from innovations in financial services and also guide the
next generation of innovations, there is need for capacity building agencies such as KIB to
develop relevant human capital in the use of emerging innovations. To this end, it is necessary
to benchmark our capacity building programmes to global best practices, and also develop
tailor-made programmes to ensure effective capacity building.
Before I conclude, I would like to flag another important innovation relating to how we
discharge our respective responsibilities in the financial sector. With great power comes great
responsibility -- the financial sector is no exception and the population expects as much. I
therefore call upon players in the sector to conduct themselves in a manner befitting the trust
that has been extended to them by their respective stakeholders and customers.
On our part, the CBK will endeavour to support the sector with appropriate smart regulation
applied even handedly. In addition, we will support the development of the sector bearing in
mind financial stability and the long-term benefits to the economy. I call upon your members
and respective institutions to support responsible behaviour in the financial sector, with an eye
on the long-term benefits accruing from such an approach. I very much hope that leadership by
KIB can facilitate the emergence of this important innovation.
Finally, allow me once again to applaud the KIB for its contribution thus far to the development
of the financial sector. You can count on the CBK’s support and collaboration in charting the
next growth phase of the sector.
It is now my pleasure to welcome Mr. Henry Rotich, Cabinet Secretary to The National
Treasury, to make his remarks and officially open the conference.
Welcome Bwana Waziri.