Entry Instance

HTTP 200 OK
Allow: GET, PUT, PATCH, DELETE, HEAD, OPTIONS
Content-Type: application/json
Vary: Accept

{
    "id": 1438657,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1438657/?format=api",
    "text_counter": 145,
    "type": "speech",
    "speaker_name": "Prof. Njuguna Ndung’u",
    "speaker_title": "The Cabinet Secretary for the National Treasury and Economic Planning",
    "speaker": null,
    "content": "Fund, popularly known as the Hustler Fund and the de-risking of lending to the Micro, Small and Medium Enterprises (MSMEs) through the Credit Guarantee Scheme have facilitated additional lending to the MSMEs sector. To position the banking sector to effectively play its role in Kenya's socio-economic transformation, three recent key reforms have been implemented: 1. First, licensing and oversight of Digital Credit Providers to address inherent challenges including high cost of credit, unethical debt collection, inadequate disclosure and lack of transparency, breach of data privacy and abuse of personal information. As at the end of March 2024, 51 Digital Credit Providers had been licensed; 2. Secondly, on climate change, CBK in April 2024 issued the draft Kenya Green Finance Taxonomy for public participation that will serve as a tool to classify whether particular economic activities are green or environmentally sustainable and serve as a guide for banking sector and other market participants in making informed investment or financing decisions. 3. Thirdly, to eliminate money laundering vulnerability in the banking sector, CBK has revised its Anti-Money Laundering and Combating the Financing of Terrorism and Proliferation Financing and a supervisory framework has been implemented so that the risk-based supervision, undertaking institutional and sectoral risk assessments, and enhancing staff complement and capacity for supervision. Hon. Speaker, the Kenyan banking sector is exposed to dynamic global, regional and local developments, thus necessitating continuous reforms. In this respect, the following reforms are proposed: 1. The CBK intends to progressively increase the minimum core capital for banks from the current Ksh1 billion to Ksh10 billion. The CBK will engage the market for an appropriate time table to achieve this goal. This is intended to strengthen the resilience and increase the bank's capacity to finance large scale projects while creating sufficient capital buffer to absorb and withstand shocks that are posed by the continuous emerging risks associated with the adoption of technology and innovations as institutions expand; and, 2. The CBK plans to amend the Banking Act to provide for stiff dissuasive penalties that are proportionate to the violations committed, support a strong compliance culture in banks and align to international best practices. On capital markets developments, in order to enhance price discovery and boost income for coffee farmers, the Capital Markets Authority has licensed 14 coffee brokers and so far, 29 auctions have been conducted under the Capital Markets (Coffee Exchange) Regulations, 2020, at the Nairobi Coffee Exchange. In addition, the Authority has approved the direct settlement system which has been operationalised by one of the local commercial banks. On pension reforms, majority of Kenyans remain uncovered with the retirement benefits coverage which stands at about 26 per cent. To address this challenge, the Cabinet approved the National Retirement Benefits Policy in November 2023 that requires all entities to enrol all the employees both contractual, permanent and pensionable to a registered retirement benefits scheme. To effectively implement the policy, we have initiated the review and harmonisation of all laws governing the retirement benefits sector. Hon. Speaker, to ensure sustainability of the public service pension system, we are revamping the public service pension administration through digitisation and re-engineering of the pension management system, which is expected to be completed by December 2024. The informal sector has about 17 million workers, accounting for 83 per cent of the total workforce. This segment has remained excluded from pension coverage mainly due to its The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}