E-Money Regulations, 2013

The E-Money Regulations, 2013, made under the National Payment System Act 2011, govern the issuance of electronic money in Kenya and the licensing of e-money issuers, including the non-bank operators behind Kenya's mobile money services. Electronic money is defined as monetary value stored electronically and issued against receipt of funds, accepted as a means of payment by persons other than the issuer. The Regulations are central to the structure of Kenya's mobile money market, which is built on the issuance and redemption of e-money in customer wallets. They require any person who wishes to issue e-money to be authorised by the Central Bank of Kenya (CBK) and distinguish categories of issuer, including e-money issuers and small e-money issuers, with proportionate requirements. The Regulations impose strict trust and safeguarding obligations: the full value of e-money issued must be backed at all times by an equivalent amount of liquid assets held in trust accounts with prudentially regulated banks, those funds must be segregated from the issuer's own funds, and they may not be lent or otherwise put at risk; issuers must reconcile outstanding e-money against the backing assets daily and rectify any shortfall by the next day. The Regulations set rules on issuance and redemption at par, on the appointment and oversight of agents, on customer due diligence and transaction limits aligned to KYC tiers, on AML/CFT compliance, and on consumer protection including disclosure of charges and complaint handling. They require technology, security and operational standards and impose reporting and audit duties. The CBK supervises issuers and enforces compliance through inspection, penalties and the power to suspend or revoke authorisation. Together with the NPS Regulations 2014, the E-Money Regulations 2013 are foundational to the licensing and prudential treatment of mobile money and stored-value products in Kenya.

1. 1Govern issuance of electronic money and licensing of e-money issuers (including small e-money issuers)
2. 2Mandatory CBK authorisation to issue e-money
3. 3Full e-money value backed by liquid assets in trust with prudentially-regulated banks; segregated, not lent
4. 4Daily reconciliation of outstanding e-money against backing assets, deficiencies cured next day
5. 5Issuance and redemption at par; agent oversight, tiered KYC/transaction limits and AML/CFT compliance
6. 6CBK supervision, consumer-protection and security standards, with penalties and suspension/revocation powers