Kenyan commercial banks are moving large amounts of physical cash to foreign countries, with the United Kingdom, United States, and South Sudan emerging as the main destinations.
This was revealed in the latest Survey on Cross-Border Movement of Cash, which showed that 15 commercial banks, making up 39.4% of all licensed banks in Kenya, are involved in shipping cash across borders.
The report, shared by Kenyan financial authorities, highlights the size and complexity of these cash movements.
According to the Central Bank of Kenya (CBK), banks mainly transport cash to repatriate foreign currency and to meet the liquidity needs of their subsidiaries abroad.
The main source of this cash is customer deposits from local branches, but additional sources include group subsidiaries, currency exchange firms, and central banks of other countries, as reported by Kenyans.co.ke.
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The UK accounted for the largest share of cash outflows at 42%, followed by the United States at 15%, Switzerland at 12%, and Germany at 4%.
The strong financial and diplomatic ties between Kenya and the UK, Kenya’s fifth-largest export destination in 2022 and its top foreign investor, make the UK a key hub for Kenyan banks, businesses, and government institutions managing foreign accounts and repatriating funds.
In the region, South Sudan received 15% of Kenya’s physical cash shipments, while the Democratic Republic of Congo (DRC) accounted for 8%.
The most transported currencies were the US dollar, euro, and British pound, showing the global reach of Kenya’s financial networks.
The US dollar was the most commonly shipped currency, highlighting its dominance in global finance, while the UK played a key role as a hub for multi-currency operations.
Kenyan regulators have stressed that these operations follow strict rules, including anti-money laundering and know-your-customer requirements.
However, the rise in cash shipments has led to renewed calls for stronger oversight amid global concerns about illicit financial flows.
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Image Credit: Business Insider Africa
