Old notes worth Ksh7.4B now worthless, CBK says

An estimated Ksh.7.4 billion worth of old notes is now worthless paper.

On Tuesday, Central Bank of Kenya (CBK) Governor Patrick Njoroge held up a briquette of the shredded notes.

“If you put all the 217 million pieces of the KSh 1,000 notes, they would fit in only five 40-ft containers. When we receive banknotes, we punch them and shred them, then compact them into a briquette,” he told journalists at a Press briefing.

According to the CBK Governor, there were 217,047,000 pieces of the old Ksh. 1,000 as at June 1.

By the end of September, 209,661,000 old notes had been returned with Dr, Njoroge revealing that over 7 million pieces were not exchanged and are now worthless.

“The value of money that did not come back is equivalent to the value lost during the Goldenberg case,” he said.

Njoroge termed the demonetization process as successful as he reiterated that the aim was to deal with illicit financial flows and counterfeits.

The Governor averred that CBK’s new anti-money laundering system will put to bed stories of people using illegally acquired cash to buy ‘big-ticket’ items such as cars.

He revealed that banks, forex bureaus, micro-finance institutions, money transfer and mobile money agents all followed the AML/CFT guidelines.

“3,172 suspicious transactions were flagged during the demonetisation period,” he noted.

Dr. Njoroge added that agencies such as the Kenya Revenue Authority (KRA), Ethics and Anti-Corruption Commission (EACC), Financial Reporting Centre (FRC), and the Directorate of Criminal Investigations (DCI) are continuing with relevant investigations.

The CBK boss also noted that the hypothesis that Kenyans are procrastinators and wait until the last minute was disapproved.

According to him, Kenyans will act properly when they know what is good for them.

He rubbished claims from critics that the demonetisation exercise did not go as planned saying:

“There was no impact on inflation. There was no queue of buyers of high-value assets to launder money – AML/ CFT measures were applied on the forex market, thus no impact on the exchange rate and there were few queues at banks.”

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