There is a new rule which discontinues issuance of all cheque of Shs. 1 million or more. This rule has greatly inconvinienced some of us. I am in the middle of some transaction and neither my lawyer nor my bank can give me any directions on how they can give an undetaking. I think CBK should have spent sometime on educating bankers and lawyers.

Baada ya dhiki,faaraja

i second @ kingfisher

break cheques into smaller values not exceeding 1M...

i.e if making a payment of 1.5M,write 2 cheques @ 750K and you avoid the bank charges...

When you run so fast to get somewhere,you miss the fun of getting there... Life is not a race,so take it slowly....

value capping is good and is in everyone's best interests. check fraud is at pandemic levels in kenya today. south africa did this a while back too. it is the way to go. the charges might be an issue but the cbk should get more assertive with these white collar shylocks.

Katika Jangwa la Jangili ndipo Pwagu hupata Pwaguzi.

kwani your bank hawana those EFT or RTGS procedures?? that should be much cheaper than spliting the payment to many cheques.

@FundamentAli

Lets embrace this RTGS/ value capping unreservedly. Besides you have no choice. Its now implemented and here to stay. Actually,the KShs 1m cap currently in force is only introductory and this cap will decline further- maybe to 500k and even below so that all payments are settled via RTGS.

In fact,Kenya has lagged behind countries like TZ and Ug which implemented the system in 2004 and 2007 respectively,while Zambia 2007,Senegal and Cote D'Ivoire in 2006. S.A uses SAMOS. In Europe they have the TARGET system that operates across 26 countries.

Its widespread acceptance and use means it possesses self-evident benefits.

With RTGS your funds reach you the same day. It also reduces high-value cheque fraud,minimises a whole lot of risks (credit,systemic,settlement,liquidity,etc).

Frankly,I don't know why folks are complaining about about this new system yet they are the same guys who were complaining that it takes 3 working days to clear a cheque. Under RTGS the guys pays you same day. Note RTGS has been in use since 2005!

Imagine if you had a KShs 2m cheque and you have to make urgent payments. Before,you would have had to wait for 3 days for it to clear or negotiate with a bank to get credit against uncleared effects in which case you would be charged Overdraft rates. But now you get your funds same day,at a token fee.

Actual losers are banks because they can no longer trade with the floats they traded with before giving you the credit. And Banks,Central Bank and Kenya Bankers Assoc had put up many adverts in the papers to raise awareness before 1st oct when value capping kicked in.

It will be fully embraced inthe fullness of time.




..there's nothing,absolutely nothing really,that I can't do if I put my mind to it.

I apprciate and blv tis a good rule to be embrcd mo 4 those ever cmpng of bng cond in big deals bung lnd and oter assets its a safety prec

Dignityis everything keep it intact

@kbeef and Intelligensia......Quite educative stuff.

@Silk....after reading the above,ya piece is abit confusing. That chqs will still take 4 days to clear? So what real time are we talking of .....

I was born intelligent,education ruined me.

@Jangwa,that was for illustrative purposes and most definitely not the Kenyan scenario.. Labda some day when we'll be a 24hr economy.

@FundamentAli

dude,you need to shift kabisaa from the idea of multiple cheques.

There is no amount too large for RTGS! Heck,Banks use it to settle business going to hundreds of millions of KShs. & even billions amongst themselves/ and high-networth clients (like the ones paid PET ALLOWANCES in hundreds of thousands of KShs,but that's a story for another day).

So 20m Kenya money is merely pocket change for the system.

For your kind of transaction of say kshs 20m where u have 20m cash ( umeiba wapi hii yote,mulika mwi... ),one option is u can place the cash on fixed deposit at good rates and get a cash-collateralised bank guarantee of same amount which you can give then your lawyer. In this way the cash asset also sweats to your advantage.But note the Bank will not refund your guarantee until either you return its guarantee or the beneficiary confirms in writing it is no longer needed. Even if you invest same amt in t-bills,any bank should be able to give you a bank guarantee of same amt against the lien created on the deposit by CBK.

For such colossal amounts however,one would have to very clear about the amount and validity of professional indemnity of the lawyers.






..there's nothing,absolutely nothing really,that I can't do if I put my mind to it.

@FundamentAli;

Yours is a case of bank staff who do not understand banking...nothing to do with RTGS...

And,hey,this is a common disease in corporate Kenya. There are just too many people working in businesses that they do not understand. This is one of the greatest factors responsible for bad service in Kenyan companies

Behind the gardens...Behind the wall...Under the tree (Including: Red...Dark Blue...Yellow)