njuguna ndung ’ u : credit information sharing to enhance financial sector development address by prof njuguna ndung ’ u, governor of the central bank of kenya, at the launch of the banking credit information sharing implementation project, nairobi, 27 august 2009. * * * mr. martin oduor - otieno, chairman, kenya bankers association ; mr. john wanyela, executive director, kenya bankers association ; chief executives of commercial banks here present ; distinguished guests ; ladies and gentlemen : i am pleased to join you this morning on this important occasion to launch the banking credit information sharing project. allow me therefore to extend my gratitude to the kenya bankers association for facilitating this project and the invitation. the importance of this function cannot be overemphasised and i am delighted at the excellent turnout of the banking fraternity. the banking ( credit reference bureau ) regulations 2008 were published in july 2008 and launched at this very venue in september 2008. the regulations paved the way for the licensing and surveillance of credit reference bureaus ( crb ) by the central bank of kenya. these bureaus will collate credit information from institutions licensed under the banking act. i am pleased to report that since the regulations became operational in february 2009, there has been considerable interest by potential investors. i do believe that interest is for those who cherish the importance of the development of information capital. the central bank has so far received three applications for crb licenses, two from local investors ( credit reference bureau africa and metropol ) and one from a south african based regional player – compuscan. accordingly the central bank has this week issued a letter of intent to the first applicant, credit reference bureau africa. this is an approval in principle to conduct credit reference bureau business. the bureau will commence operations on completion of an independent third party system and security audit and an onsite inspection by cbk. the letter of intent was granted after a detailed due diligence of the application to ensure all statutory and prudential requirements were met. the central bank wishes to reassure kenyans that it shall rigorously assess all applications to ensure the integrity of the envisaged credit information sharing mechanism. ladies and gentlemen : the launch of this project today by the banking sector is therefore very timely. the overarching objective of the project is to co - ordinate the efforts of all players so as to build a sustainable and holistic information sharing mechanism. the central bank renders its full support

do you understand the financial health needs of your customers? do you have products and services that meet their needs at the different stages of their life cycles? the needs of different customer segments vary given their income segment and stage of life. the risk appetite of high networth customers will indeed differ from a middle class family with children about to join university. a broad brush stroke approach to product development in an environment like this is redundant and the challenge is to customize products and services accordingly. second, is transparency and disclosure. customers are now faced with a myriad of financial services and products that they may not understand. the allure of anytime and anywhere financial services is increasingly leading consumers to partaking the services and products without adequate knowledge. this has led to challenges including overindebtness and addiction to betting and gaming. third, a holistic and collective approach to financial health is imperative. all players including regulators, financial service providers, customers must come to the table to strengthen the financial health of our populace. i am therefore pleased to note the participation in today's launch not just of commercial banks, but also of insurance companies, microfinance banks, saccos and payment services providers. we are all serving the same customers who require a variety of products for their financial wellbeing and ultimately enhanced lives and livelihoods. 3 / 4 bis - central bankers'speeches as i draw to a close, the campaign we are launching today should not just be about financial literacy. it should be about enhancing the financial health of kenyans. the words of queen maxima of netherlands, a global proponent of financial health are apt, " it is important to remember that financial inclusion on its own - is not enough - rather it is a means to an end. it remains critical to be deliberate in targeting positive development outcomes that strengthen the resilience of people and small businesses, and contribute to their improved financial health. " we have ways to go but i am confident we will get there. we must. and in the words of a famous proverb, if you want to go far, go together. thank you! 4 / 4 bis - central bankers'speeches