Kenya is considering new legislation that would empower its central bank to take control of struggling payment companies and sell their businesses, in a move aimed at protecting customers and limiting disruption when financial service providers fail.
The proposed National Payment System Bill, 2026, would give the Central Bank of Kenya (CBK) authority to intervene when a payment provider cannot meet its obligations to customers or other financial institutions, violates regulatory requirements or poses a threat to financial stability.
Brandspur Banking News Desk reports that the proposed changes could significantly expand the regulator’s powers over companies responsible for processing payments and holding customer funds. Under the framework, providers facing serious financial or operational difficulties could lose control of their businesses before the situation progresses to liquidation.
The draft legislation would also allow the central bank to appoint a statutory manager to oversee a troubled provider and arrange the sale of its business. Such intervention could transfer decision-making authority away from existing owners and investors, giving the regulator a more direct role in determining how the company’s operations are handled.
The proposal centres on the risks that emerge when payment companies become unable to fulfil their obligations. Customers and businesses increasingly depend on payment providers to transfer money and process transactions, making the stability of these services important to everyday financial activity.
A provider’s failure can leave customers uncertain about access to their funds and create difficulties for businesses that rely on timely payments. The proposed powers are intended to give the regulator options for dealing with a failing company while addressing risks to customers and the wider financial system.
For payment firms and their investors, the legislation could introduce more direct regulatory intervention when a business becomes distressed. If the bill is enacted, a company could face a transfer of control and a regulator-led sale rather than retaining authority over its own restructuring.
However, the proposal remains a draft bill, meaning the suggested powers should not be treated as existing law. Its final provisions and implementation will depend on the legislative process.
The planned reforms reflect the importance of regulatory oversight in a payments sector where private companies play a central role in moving money between individuals, businesses and financial institutions. For consumers, the key issue will be whether the eventual framework provides an effective way to manage failing providers and protect access to funds when a company encounters serious difficulties.
