Kenya is known for a good number of things on the global map. The country’s tourism sector has enjoyed prominence thanks to white and sandy beaches on Kenya’s coastline, annual wildebeest migration across the Mara River, Snowcapped Mt. Kenya, hot springs and lakes of the Rift Valley, a sizable share of the World’s second-largest freshwater lake and host to humanity’s cradle land in Turkana. Lately, Kenya’s main export has shifted from Agricultural produce and tourist services to Labour. Various reports by the World Bank project Kenya as a leading economy in Africa by 2030 not for oil or precious stones but for its highly sought-for labour in the global market.
According to a CBK Survey published in December 2021, Diaspora remittances to Kenya have increased tenfold in the last 15 years hitting an all-time record of USD 3,718 million. This is more than 3% of Kenya’s GDP. Remittances flow into the country to majorly meet needs in food, healthcare, education and housing. Most Kenyans who live abroad left in pursuit of jobs and higher education. Other reasons for leaving include marriage and diplomatic duties. Most Kenyans living in Asia take up jobs demanding fewer skills while those in Europe and Oceania have to work longer to save and send money to the country.
In sending remittances, most people use formal channels and over 60% of those who send money to transact monthly at higher transaction charges that would be avoided through the creation of a more favourable platform. Such a platform needs to be as convenient to use as banks, money transfer companies and mobile operators but affordable as Hawalas and secure as Credit Unions. This is the intelligence being used by Suleiman Shahbal, owner of Gulf African Bank, to set up and run a diaspora Bank. Suleiman Shahbal and his support team are working around the clock to register Kenya’s first diaspora bank within the 3rd Quarter of 2022. Having successfully disrupted Kenya’s banking landscape with Islamic banking products and procedures through Gulf African Bank, Mr Shahbal is convinced that opportunities in diaspora banking are his’ to grab. To register a bank in Kenya, one needs a number of licenses and approval from regulators among them the Central Bank of Kenya, Capital Markets Authority and Competition Authority. He also needs to deposit a cash reserve with the Central Bank of not less than 5.25% of total domestic and foreign currency liabilities.