The Central Bank of Kenya (CBK) is planning a new national payment switch that could lower the cost of transferring money between banks, mobile money platforms and other payment providers.
The switch is part of a proposed overhaul of Kenya’s payment system contained in the Draft National Payment System Policy for August 2026, which identifies high transaction costs and fragmented payment platforms as key challenges facing consumers and businesses.
Treasury and CBK want the proposed system to support instant payments across the country, allowing transactions to move between different payment platforms in real time.
The draft policy proposes the development and implementation of a national instant payment switch as part of efforts to create a more integrated payment system.
A person holding a phone and a debit card.
Photo
Canva
Currently, Kenya has made significant progress in connecting mobile money services. However, the government says interoperability across the wider payment ecosystem, including banks, payment service providers and government platforms, is not seamless across all transactions.
The proposed switch is expected to address some of these gaps by allowing different payment systems to communicate through common technical standards and infrastructure.
The government also plans to introduce open API standards, which would enable financial institutions and payment providers to connect their systems and process transactions across different platforms.
“The government will develop and implement a national instant payment switch,” the draft policy seen by Kenyans.co.ke states.
The policy further proposes requiring banks, payment service providers and payment system operators to adopt national or global messaging standards to improve how payment platforms exchange transaction information.
Treasury and CBK also intend to provide incentives to institutions that adopt seamless interoperability while introducing regular compliance audits to ensure payment providers meet the required technical and operational standards.
However, the draft does not set specific charges that providers would be required to impose on customers, meaning the actual reduction in transfer fees would depend on how the proposed system is implemented and how providers price their services.
At the same time, the draft also proposes changes to the payment laws, a testing system for new payment technologies, and allowing more non-bank companies to access key payment systems.
CBK Governor Kamau Thugge during the unveiling of the Kenya Bankers Association Institute (KBAI) on September 30, 2026.
Photo
KBA