Central Bank of Kenya. Photo | Courtesy.
The Central Bank of Kenya (CBK) has announced it will lift the moratorium on the licensing of new commercial banks, effective July 1, 2025.
The moratorium, which has been in place since November 17, 2015, was introduced to address governance, risk management, and operational challenges in the banking sector.
READ Africa Moves Towards Continent-Wide AI Fund For Economic Growth
In a statement released today, CBK noted that the decision to lift the ban follows significant progress made in strengthening the legal and regulatory framework of the banking sector.
Over the past decade, the sector has seen several mergers and acquisitions as well as the entry of strategic investors, both local and foreign.
The move comes in the wake of amendments to the Business Laws (Amendment) Act, 2024, which raised the minimum core capital requirement for commercial banks to Sh. 10 billion.
CBK says this will help bolster the sector’s resilience by ensuring that new entrants are financially sound.
“Following the lifting of the moratorium, new entrants to the Kenyan banking sector will be required to demonstrate that they can meet the enhanced minimum capital requirements of Sh. 10 billion,” read part of the statement.
The regulator emphasized that stronger, well capitalized banks will be better positioned to manage financial risks and support large scale financing for Kenya’s economic development.
The moratorium had initially been put in place to give regulators time to address weaknesses in the sector and promote sustainable growth.
ALSO READ MTN Partners With Synamedia To Launch New Video Streaming Platform
With its lifting, the CBK is expected to start receiving applications for new banking licenses, signaling a potential wave of new players entering the market.
