Kenya’s central bank has capped the amount of dollars that money transfer companies can sell to an individual customer at $100,000 per day. This was communicated through a central bank letter to the firms.
The firms, which provide cash remittance services to those living abroad, will be required to sell any hard currency amounts exceeding $100,000 only to commercial banks, the regulator said in the letter dated Wednesday and seen by Reuters on Thursday.
The move was caused by an observation that the firms have been participating in the wholesale foreign exchange market without complying with the various guidelines, standards, and code that govern that segment, the central bank said.
There are around 11 money remittance companies that are licensed by the CBK to operate in Kenya.
The remittance companies provide funds transfer services as Kenyans living abroad are able to send money back home.
The multibillion remittance industry has also risen to become the single largest foreign exchange earning sector for Kenya bringing in nearly half a trillion shillings in 2022.
The move to limit the sale will create a fair and orderly market, the bank said.
The Kenyan shilling has been under sustained pressure from the dollar for more than a year. According to CBK rates for Thursday, September 14, the US dollar is selling at Ksh146.76.