What is to prevent someone doing church harambees for the next 15 weekends and giving 300 million at each harambee. Bishop and congregation are present and they participate in Harambee. Is there any legal requirement for congregation to declare where they got church harambee money? Do they even have to declare how much they give? I am sure a pastor will be quick to preach "do not let what the right hand know what the left hand is doing" scripture.

Now the church has the money. Bishop shows up with 3000 million cash at a bank and declares "ni mchango wa kanisa". All legit. Which bank will be the first to refuse to bank for a church. Once in the system church goes on a spending spree buying real estate and building apartments and townhouses.

Psst....i know a certain archbishop, chief, genero, komanda who might be game for such a deal. You have to seriously respect his wife though.

From P Njoroge’s wall


After the president’s announcement on the Ksh 1000 note yesterday, we saw some arguing that the move won’t be successful because most of the cash being hoarded is in form of dollars, and those keeping in in form of Ksh will convert it to dollars within the 120 days given.

Well, today I decided to talk to someone who could provide expert analysis on the matter, and this was my take home:

The cash outside banks is 230 Billion and this is what the president wants to bring back to the formal economy or in the banking sector. As of June 2018, there were 210 million one thousand shilling notes in circulation valued at KShs 210 billion. This means majority of the notes both in and outside banks is of Ksh. 1,000 denomination and only 20 Billion is in other denominations and currency.

Foreign Exchange Reserves in Kenya increased to 11737.70 Million USD Million in February from 11387.20 Million USD in January of 2019. Thus to convert the Ksh 230,000,000,000 outside banks to dollars would require $2,300,000,000 or almost 20% of the total forex reserves. This CBK can't allow because the Ksh would decline to around Ksh 125 per dollar and given the dollars required to repay debt and exports, the economy would simply collapse given that Kenya is a net importer. Therefore government would not avail the dollars.

The dollars in the economy are very controlled so as to keep a stable exchange rate of between 95-105. And as stated above, because of the foreign debt repayment, the CBK cannot allow appreciation of the dollar, as every Ksh. 1 rise in exchange rate increases our debt by a huge margin.

So what is likely to happen is that we will see completion of more houses and purchase of assets at exaggerated prices i.e.cars, lands etc in the next four months. We can also expect inflation up to mid next year as effects of demonetization typically take 6-12 months.

All in all, this was a very necessary move. The money being hoarded needs to be injected back to the formal economy.

can one withdraw say 10m legit money new currency and deposit the same in the same bank after a day or two in the old currency.

As per KYC policy, you will have to explain the source of your old 1000 notes....otherwise if you say "these are the notes I withdrew jana", then please return the new bills please,sio hizi mzee.
Thank you.

@TNT, In Money Laundering, you clean the cash and its gets back to you as legit. In a mchango, the illegit passes to the church and it becomes legit but the launder losses it.

Simon Mbugua (MP) & Okiya Omtatah have already moved to court separately to block the issuance of new notes

@TNT, In Money Laundering, you clean the cash and its gets back to you as legit. In a mchango, the illegit passes to the church and it becomes legit but the launder losses it.

They may succeed in stopping the issuance of new notes but can they stop de~legalizing of the 1K note?