of national strategies that promote financial inclusion are critical to enhancing access to a diverse range of financial products to the unbanked in kenya, the mandate of the government to enhance the deepening of financial markets by fostering access, efficiency and stability is captured under kenya ’ s vision 2030. the central bank ’ s approach to achieving its role under vision 2030, is centered on the promotion of an enabling legal and regulatory framework that fosters the development of a diverse range of financial service providers, while guaranteeing its dual mandate of financial stability and financial integrity. central to this objective has been the licensing and regulation of microfinance banks. the first microfinance bank in kenya was licensed in may, 2009. this paved the way for 11 other microfinance banks which have been licenced to date. the 12 licenced microfinance banks have made a significant contribution to financial inclusion in kenya. this is evidenced by the number of active deposit and loan accounts as at december 2015 which was 931, 585 and 342, 481 respectively. in value terms, this represented bis central bankers ’ speeches ksh. 40. 5 billion in deposits and ksh. 46. 9 billion in advances. further, microfinance banks had a footprint of 109 branches and 1, 154 agents as at december 2015. while commendable achievements have been made in the past 6 years, the microfinance sector in kenya still has considerable opportunities and challenges that institutions need to tackle in order to realize their full potential. key amongst these challenges include the high cost of credit, inadequate products and services, and weak consumer protection frameworks. microfinance institutions must be willing to make a difference if the full benefits of microfinance and financial inclusion are to be realized. microfinance institutions must be prepared to employ innovative delivery channels to reduce their operational costs, and thereby enhance their reach and efficiency. an essential element in this process is recognizing the characteristics of the customers of these institutions and tailoring lending mechanisms to meet their situations. policymakers, on their part, should support the development of appropriate support infrastructure to facilitate the last mile delivery of suitable financial services. therefore, the development of proportionate, risk - based, regulations by policymakers is critical to guaranteeing the development of a dynamic, robust and sustainable microfinance framework for a country. the starting point towards this collaborative structure is a consultative process to developing a forward - looking framework for regulation and supervision of microfinance institutions. developing

laws and regulations that facilitate financial inclusion and the involvement of diverse institutions in the microfinance sector will go a long way to enhance provision of diversified microfinance services in a sustainable basis for the economically active poor and low income households. as i conclude, my expectation is that the ideas to be presented and discussed over the next few days will form the basis for development of robust and sustainable national strategies for microfinance. i hope that by the end of this workshop, you will have come up with a model comesa strategy for microfinance regulation and supervision that will enhance financial inclusion in the region. such a model strategy will not only provide a yardstick for microfinance regulation and supervision but will also go a long way in the harmonization and convergence of these practices, and ultimately contribute to monetary integration in the comesa region. you have an opportunity to share experiences and assess a range of novel policy interventions that allow the unlocking of the benefits of financial services innovations. i wish you fruitful deliberations over the next few days and i look forward to the outcomes of your deliberations. thank you. bis central bankers ’ speeches