NAIROBI, Kenya – The Central Bank of Kenya (CBK) has officially announced its transition from the Kenya Electronic Payment and Settlement System (KEPSS) to the globally recognized ISO 20022 financial messaging standard.
This shift marks a significant step in modernizing Kenya’s financial infrastructure and aligning the country’s payment systems with international standards.
KEPSS, Kenya’s Real-Time Gross Settlement (RTGS) system, processes large-value and time-sensitive transactions.
Operated by the CBK, it is a critical component of both domestic and regional financial systems. Over the past year, KEPSS handled more than 5.3 million transactions, valued at over KSh 45 trillion, showcasing its importance in Kenya’s economy.
The migration to ISO 20022, an internationally accepted open standard for financial messaging, promises to bring several improvements, including faster settlement times, enhanced fraud detection, and more efficient liquidity management for financial institutions.
The rich data formats embedded in the new system are designed to better monitor and prevent illicit transactions, enhancing overall security in the financial system.
In August, the CBK directed banks and microfinance institutions to begin testing the upgraded system.
The goal is to ensure seamless handling of high-value transactions while improving both speed and security.
According to the CBK, the standardization provided by ISO 20022 reduces the complexity of payments, making the process more efficient for all stakeholders.
Originally scheduled to go live by the end of September 2024, this transition positions Kenya ahead of the global deadline set by the Society for Worldwide Interbank Financial Telecommunications (SWIFT), which has called for all countries to adopt the standard by early 2025.
“The adoption of ISO 20022 enhances interoperability between domestic and international payment systems, streamlining cross-border transactions and supporting Kenya’s broader ambitions of becoming a global financial hub,” the CBK said in a statement.
As part of the National Payments Strategy 2022-2025, this transition builds upon previous modernization efforts, such as the migration of the Cheque Clearing House to the ISO 20022 standard.
The new platform promises to significantly enhance the convenience, speed, and security of payments for both corporations and individual customers.
Financial institutions are now expected to support their customers through this transition, ensuring smooth integration and uninterrupted services.
The ISO 20022 standard is widely seen as the future of financial messaging, offering more comprehensive data formats that improve security and reduce the incidence of fraud and cybercrime in domestic and international high-value payments.
This shift marks a significant step in modernizing Kenya’s financial infrastructure and aligning the country’s payment systems with international standards.
KEPSS, Kenya’s Real-Time Gross Settlement (RTGS) system, processes large-value and time-sensitive transactions.
Operated by the CBK, it is a critical component of both domestic and regional financial systems. Over the past year, KEPSS handled more than 5.3 million transactions, valued at over KSh 45 trillion, showcasing its importance in Kenya’s economy.
The migration to ISO 20022, an internationally accepted open standard for financial messaging, promises to bring several improvements, including faster settlement times, enhanced fraud detection, and more efficient liquidity management for financial institutions.
The rich data formats embedded in the new system are designed to better monitor and prevent illicit transactions, enhancing overall security in the financial system.
In August, the CBK directed banks and microfinance institutions to begin testing the upgraded system.
The goal is to ensure seamless handling of high-value transactions while improving both speed and security.
According to the CBK, the standardization provided by ISO 20022 reduces the complexity of payments, making the process more efficient for all stakeholders.
Originally scheduled to go live by the end of September 2024, this transition positions Kenya ahead of the global deadline set by the Society for Worldwide Interbank Financial Telecommunications (SWIFT), which has called for all countries to adopt the standard by early 2025.
“The adoption of ISO 20022 enhances interoperability between domestic and international payment systems, streamlining cross-border transactions and supporting Kenya’s broader ambitions of becoming a global financial hub,” the CBK said in a statement.
As part of the National Payments Strategy 2022-2025, this transition builds upon previous modernization efforts, such as the migration of the Cheque Clearing House to the ISO 20022 standard.
The new platform promises to significantly enhance the convenience, speed, and security of payments for both corporations and individual customers.
Financial institutions are now expected to support their customers through this transition, ensuring smooth integration and uninterrupted services.
The ISO 20022 standard is widely seen as the future of financial messaging, offering more comprehensive data formats that improve security and reduce the incidence of fraud and cybercrime in domestic and international high-value payments.
