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Why CBK rejected mobile money transfer by bankers

The Central Bank of Kenya (CBK) on Wednesday rejected the mobile money transfer platform, PesaLink over..

CBK Governor Dr Patrick Njoroge

Making the announcement, CBK governor Patrick Njoroge stated that the mobile money transfer was too slow and ordered KBA, which was representing 43 lenders, to recalibrate their system for faster transactions as a condition for rollout.

“We had this group of banks approach us with their mobile money transfer product. We asked them how long it will take to transact and they said 40 seconds. We send them back to cut the time.

"They came back with 20 seconds. We send them back again. The transaction time should be less than 10 seconds,” Dr Njoroge said.

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The CBK Governor said that a simple transaction should not take that long and affirmed that the planned launch of Pesalink would only go ahead if the time was adjusted.

“They have to get their act together first before launch. Why should a simple transaction take 20 seconds?” Dr Njoroge posed.

Pesalink is expected to rival Safaricom’s M-pesa transfer which has dominated the Kenyan market.

PesaLink, will allow account holders to transfer money across different banks, which was initially opposed by banks but later agreed upon seeing the numerous advantages.

Unlike M-pesa which limits cash transfers to Sh140, 000, Pesalink will allow an individual to transfers up to Sh1 Million on a daily basis.

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Njoroge’s announcement will force the lenders to adjust the planned launch until they make the required adjustments.

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