The Central Bank of Kenya (CBK) could soon gain stronger powers to enforce compliance in the financial sector under the Banking (Penalties) Regulations, 2025, which were presented to Parliament by Treasury Cabinet Secretary John Mbadi.

The regulations are currently under consideration by the Parliamentary Committee on Delegated Legislation.

According to an X post, on Thursday, November 13, 2025, the Treasury said the regulations aim to tighten oversight by allowing the CBK to impose stiffer penalties on banks that breach the Banking Act and related guidelines.

The measures are intended to make penalties effective, proportionate, and dissuasive, aligning Kenya’s banking sector with international standards under the Basel Core Principles.

“The Banking (Penalties) Regulations, 2025, strengthen the compliance framework within the financial sector by empowering the Central Bank of Kenya (CBK) to impose stiffer penalties for violations of the Banking Act and related guidelines,” the X post reads.

Kenya’s banking penalties regulations are being revised, increasing maximum penalties to Ksh20 million for institutions and Ksh1 million for individuals, with higher daily penalties for non-payment. The new rules introduce a new appellate process for those penalized and include penalties for issues like failing to provide adequate customer information or engaging in unethical practices.

The Central Bank of Kenya fined 11 commercial banks more than Ksh5 million each for breaching insider lending rules in 2024. These violations involved lending more to staff and directors than allowed, putting customer deposits at risk and highlighting governance gaps in the sector.

The fines demonstrated the need for stronger penalties and a clearer compliance framework, which the Banking (Penalties) Regulations, 2025, now aim to provide.

Other key regulatory updates

Alongside the Banking (Penalties) Regulations, Mbadi also presented amendments to the Sports, Arts and Social Development Fund and the Government Press Fund.

The Sports, Arts and Social Development Fund (Amendment) Regulations, 2025 seek to enhance transparency and improve the Fund’s governance by streamlining its scope to focus on sports and the arts, while removing health financing now covered under the Social Health Authority.

The Government Press Fund Regulations, 2025 aim to modernize and sustain the operations of the Government Press, Kenya’s central printing and publishing agency established in 1895. The Fund will ensure timely production of official documents, including the Kenya Gazette, and support modernization of printing infrastructure.

All three regulations have undergone public participation and comply with the Statutory Instruments Act, 2013, reinforcing the government’s commitment to accountability. Lawmakers are expected to review the regulations and provide recommendations before they are adopted.