The time it takes interbank cheque clearances to clear in Kenya could be reduced from three days to one day, thanks to an updated technology system.
The renewed timeline dubbed ‘T+1’ is planned to take effect from August 19, according to the Kenya Bankers Association (KBA).
The KBA says it has been in the process of implementing the tech, which implements a faster clearance cycle among banks in the country.
Furthermore, the automated clearing house (ACH) in charge of interbank transactions in Kenya plans to ensure that receiving banks process cheques in a shorter time, prior to the ACH approving the transaction.
“The shorter cheque clearing cycle will enable customers to know the fate of their cheques faster, and funds will be availed one day earlier than in the previous cycle,” said KBA chairperson Jeremy Awori.
“We are excited about this development that will benefit bank customers by speeding up their cheque payment transactions, ultimately enhancing the flow of funds in the economy.
“Over the years, KBA has been able to dramatically reduce the cheque clearing period from a high of 21 days in the 1990’s. The initiative is the result of collaboration between commercial banks and the Central Bank of Kenya and forms part of reforms being implemented in the National Payment System,” Awori said.
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