Every Kenyan working in a bank will be forced to pay Sh10,000 per year and an additional Sh25,000 membership registration to the proposed Institute of Bankers.

Around 10,500 professional bankers are expected to register in the next three years and submit to the payments which are also liable to a five per cent annual increment. This follows a proposed bill by Kesses’ Member of Parliament Julius Rutto (pictured) who seeks to enhance and regulate the banking profession in Kenya.

The Institute of Bankers Bill, 2024 aims to establish the institution for bankers that will oversee the training, registration, licensing, and regulation of all bankers in the country.

According to Rutto, the institute will set the professional standard for banking practice and regulate professional development within the region.

Banking education

In addition, it will grant licenses to those who fulfill the prerequisites for bankers and award certificates to those who fulfill the standards for banking education.

“To be registered as a banker, an individual must demonstrate good conduct, pay the prescribed fees, and complete recognized educational programs, whether in Kenya or abroad, as determined by the Bankers Examination Board.  Furthermore, candidates must fulfill specific educational requirements by passing accredited banking exams or providing evidence of prior learning in banking and Financial Services, as stipulated by the relevant institution, “ read the bill in part.

Rutto cited the lack of a formal and centralized professional body to regulate, train, and certify bankers as one of the key influencers to the proposed bill.  According to him, despite the Central Bank of Kenya overseeing all financial institutions in the sector, and the Kenya Bankers Association being the umbrella organization for banks, there is no regulation of banking professionals.

The proposed Institute of Bankers will apparently formalize standards for banking practice in Kenya and set clear guidelines for professional conduct and qualifications.

It will also provide better regulation and oversight of the banking profession and promote teaching of banking in various levels of education from secondary schools to universities.

With this bill, Kenya Kwanza government is looking to generate Sh8.2 million in the first financial year. It is also projecting to collect sh34.8 million in the second year, and Sh98.6 million in the third year.  Additionally, it promises to increase public confidence in the sector and support the overall growth of the banking sector.

Despite forcing bankers to dig deeper into their pockets, proposals in the bill will enrich its committee members and staff who will take away hefty allowances, subject to an annual increment.

The council which consists of a chairperson and seven other members will have a Sh1,000,000 allowance in the first year, 1,050,000 in the second year and 1,102,500 in the third year.

The Examination Board, consisting of nine members and a CEO will also take home Sh1,000,000, liable to a yearly rise of 1,050,000 in the second year and 1,102,500 in the third year.  Twenty staff of the Council and the Examination Board of the secretariat will receive Sh150,000 every month.