President Uhuru Kenyatta unveiled new generation banknotes, expected to replace the ones in circulation during the celebration of Madaraka Day.
Presenting the new currency to President Uhuru, Central Bank Governor Patrick Njoroge said the new banknotes contain each of the big five animals and just like the new coins, will serve as means of passing knowledge, conserving culture and promoting the country’s uniqueness to the world.
The banknotes contain the image of the Kenyatta International Conference Centre, an iconic landmark with the inclusion of Mzee Jomo Kenyatta’s sculpture. He also disclosed the current new notes will be circulated alongside those previously issued but the old generation one thousand shilling banknotes need to be exchanged by October 1.
Governor @njorogep announces the unveiling of the New Generation Currency banknotes. Old generation one-thousand shilling banknotes will need to be exchanged by October 1, 2019, after which they cease to be legal tender. pic.twitter.com/iyy1lpaKuy
— Central Bank of Kenya (@CBKKenya) June 1, 2019
However, Activist Omutatah and EALA MP Simon Mbugua, moved to court to challenge the issuance of the new banknotes. According to Article 231 (4) of the Constitution: “Notes and coins issued by the Central Bank of Kenya may bear images that depict or symbolise Kenya or an aspect of Kenya but shall not bear the portrait of any individual.” But the new banknotes still contain the portraits of Mzee Jomo Kenyatta which is unconstitutional.
On the expiry of the old one thousand shillings notes, Omutata highlights that the new notes are supposed to be used concurrently with the old ones until a time when the old notes are no longer in circulation and CBK announcement to the public cannot be accepted.
In a press briefing on Monday, CBK Boss noted that introduction of new banknotes followed due procedure and they can defend themselves in court. He dismissed those contesting the inclusion of Mzee Jomo Kenyatta’s sculpture on the notes saying that the key feature was the KICC.
Governor @njorogep: We will continue to release the New Generation Currency banknotes to all commercial banks and microfinance banks. This process will work seamlessly. pic.twitter.com/MWPZMc7ZJl
— Central Bank of Kenya (@CBKKenya) June 3, 2019
“I have been informed of a legal challenge that has just been filed. We are going to deal with those issues as a matter of priority,” he responded.
He said the decision to do away with the old generation one thousand notes, was not the first time Kenya is doing demonetisation. The four-month period given is to accommodate everyone.
Governor @njorogep: The Central Bank of Kenya has always had the right to withdraw currency, and has withdrawn some in the past. pic.twitter.com/KIdAeKMHYq
— Central Bank of Kenya (@CBKKenya) June 3, 2019
“We have the power to demonetise. We did it in 2011 with Sh5 notes. This was done as a matter of national security. Illicit financial flows are real. There is a balance we had to strike. Immediate demonetisation would have been tough on Wanjiku who are dealing in legit business,” said CBK governor.
As per the new directives issued by CBK, those who want to exchange the old notes for a value of less than KES 1 million can do so at their bank branches. People without bank accounts can exchange at any branch of any bank, or even at the CBK but will need to have official identification.
Individuals who want to exchange amounts between KES 1m and KES 5m will need to go to their own banks. Those who do not have bank accounts and want to exchange this amount will need to contact the CBK, while those who want to exchange amounts above KES 5 million who are very few, will need to contact the CBK.
