What happened

The Central Bank of Kenya (CBK) announced that it is now accepting public comments on the draft National Payments System Bill and its accompanying policy framework. The invitation, published on Business Today Kenya, signals the regulator’s intent to refine the legislation before it is tabled in Parliament. The call for feedback is open to banks, mobile money operators, fintech firms, consumer groups and any interested Kenyan citizen. CBK expects written submissions to be lodged by the deadline it will set in the official notice.

Context and background

Kenya’s payments ecosystem has evolved rapidly over the past decade, driven largely by mobile money platforms such as M-Pesa, which now handle a substantial share of retail transactions. The existing Payments System Act of 2019 provided a regulatory foundation, but rapid innovation in digital wallets, QR‑code payments and cross‑border fintech solutions has exposed gaps in the law. To address these gaps, CBK drafted the National Payments System Bill, which seeks to broaden the definition of payment service providers, introduce clearer licensing criteria and strengthen consumer protection mechanisms.

The draft bill also proposes a new supervisory framework that would give CBK greater oversight of real‑time gross settlement systems, digital currencies and emerging payment infrastructures. In addition, the policy paper accompanying the bill outlines expectations for data sharing, cybersecurity standards and interoperability among payment platforms. The regulator’s move to open a public comment period follows a series of stakeholder workshops held in Nairobi and Mombasa earlier this year, where industry players highlighted concerns over licensing fees, reporting burdens and the need for a level playing field between banks and non‑bank providers.

Historically, Kenya has relied on consultative processes to shape its financial legislation. The 2019 Payments System Act, for example, underwent a 45‑day public consultation that incorporated inputs from the Kenya Bankers Association, the Communications Authority and consumer advocacy groups. By inviting comments on the new bill, CBK is continuing that tradition, aiming to balance innovation with stability, and to ensure that any regulatory changes are grounded in practical realities faced by SMEs, merchants and everyday users.

Compared with what is normal

In Kenya, regulatory consultations typically run for 30 to 60 days, depending on the complexity of the proposal. The current invitation aligns with that norm, offering a similar window for stakeholders to submit written feedback. Compared with the 2019 Payments System Act, which received over 200 written submissions, the expected volume for this bill may be higher given the proliferation of fintech startups and the growing public interest in digital finance. Below are some typical benchmarks:

  • Consultation period length: 30‑60 days (current invitation falls within this range).
  • Number of respondents in previous payment‑system reforms: ~200‑250 organisations and individuals.
  • Key themes raised historically: licensing fees, consumer data protection, interoperability.
Why it matters

The National Payments System Bill will shape how payments are processed, cleared and settled across Kenya for years to come. For SMEs, clearer licensing rules could reduce compliance uncertainty when partnering with mobile money agents or integrating QR‑code solutions. Consumers stand to benefit from stronger data‑privacy safeguards and clearer dispute‑resolution pathways if a transaction goes awry. At the macro level, a modernised payments framework can attract foreign investment in fintech, support the government’s financial‑inclusion agenda and enhance the resilience of Kenya’s payment infrastructure against cyber threats.

However, the bill also carries potential costs. Stricter licensing criteria may raise entry barriers for smaller fintech firms, potentially limiting competition. Increased reporting requirements could impose additional administrative burdens on banks and non‑bank providers alike. Understanding these trade‑offs is essential for business owners who must decide whether to adapt existing payment channels or invest in new technology to stay compliant.

Practical steps
  • Review the draft bill and policy paper available on the CBK website; note sections that directly affect your business operations.
  • Prepare a concise written comment (max 1,000 words) highlighting any concerns or suggestions, especially around licensing fees, reporting timelines and consumer protection.
  • Coordinate with industry associations such as the Kenya Bankers Association or the Fintech Association of Kenya to align your feedback with sector‑wide positions.
  • Submit your comment before the deadline using the online portal or the email address specified in the CBK notice.
  • Monitor CBK updates after the consultation period; be ready to adjust internal processes once the final bill is enacted.

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Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.