Banks in fresh trouble as new Bill proposes ban on deposits of public funds

Looks like our leaders are out to finish banks. I wonder what they stand to gain.
The only banks allowed to take public money are those in which the Government has atleast a 20 per cent stake directly or indirectly. These are just five: Kenya Commercial Bank, National Bank of Kenya, Consolidated Bank of Kenya, Development Bank of Kenya and the Post Office Savings Bank.

https://www.standardmedia.co.ke/mobile/article/2000230797/banks-in-fresh-trouble-as-new-bill-proposes-ban-on-deposits-of-public-funds

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Good!

Nice move

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Good, this was also implemented in Nigeria. They need to go even further and make sure all government accounts are based central banks only, including all departments. Sometimes government borrows money domestically to fill short term short falls yet some department have billions in their account that they aren’t utilizing. Government should have all it’s accounts centralized to save it from borrowing at an expense.

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But is that really going to encourage private investors?
Other than KCB, all the other banks where the government has shares are not exactly doing that well

Happened in Tz also, banks that were reporting good profits went into the red immediately. But I support it, a government institution like HELB had placed a huge fixed deposit in Chase Bank, then chase bank uses that money to buy government bills, it pays part of that interest to helb and keeps part of it, hio ni ufala!

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Yes it will since now these banks will have no chance but to court us citizens for business. That will mean better offers and services for the customer. Hawking of loans will come back and cheaper credit for businesses.

Please disregard my earlier post, after reading the article the bill it has gone the extra mile as I suggested. All government accounts will be centralized at Central Bank. If it must go to commercial banks then on those that government own. Before the account is opened and money transferred then permission must be sort from Treasury and the money can stay more than 21 days.

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If that’s what guys have been doing with public funds, then the move is justified. Managers delaying @rollout of programs so that they can skim interest earnings from funds purposely kept in fixed deposit accounts.

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Good move. Mtu avune kwenye amelima. The banks have been holding government money. e. g delaying payments in some sectors.

I whole heartedly support that move.

With my legs crossed actually.

:smiley: :smiley: :smiley:

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I’m curious to know what will happened to Commercial Bank of Africa specifically …you know what I mean specifically

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Toka apo ama you’ll hear the rwnbp squad throwing stones

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Sawa Sawa

Banks have to be creative going forward. CBA bank partnered with Safaricom and Mshwari was born. They lend billions to Kenyans and make good profit. Mshwari has been launched in Uganda as well. KCB learned from CBA and KCB Mpesa is a good product as well. Equity is going well with Equitel and moving most of its banking services online. Now the rest have to catch up, reinvent themselves, be bought or collapse.

Panua kidogo tu. Alafu unitumie picha pale inbox. Sitakuanika hadharani

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You are really way back on this one. From time immemorial, you cannot open a bank account in government unless it has been authorised by the CS the national treasury. In practice however, the accounting officer opens and declares it to the national treasury.

I think the law is good not so much for the central government but the county government. I have seen chaos there. One month, pesa iko kcb, the next iko in some unimaginable bank

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Bingwa leo umeongea sense vizuri sana. Shukran ama jaba ilikata?

Counties have had arrangements with some banks to advance them cash whenever disbursements from Treasury delay. What next?

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Long overdue

I thought parastatals were already compelled to operate accounts in banks where the gvt has a stake? is this new?

This is a ‘small’ cashcow in the family’s portfolio which can be happily pawned away to preserve the bigger ones.