Banks
The banking sector is well developed. The leading banks in terms of asset ownership are Kenya Commercial Bank, Barclays, Standard Chartered and Cooperative Bank. Of the 44 licensed institutions one is a mortgage finance company and 13 are foreign owned. In 2012 there were no building societies licensed in Kenya. At least ten banks are listed on the Nairobi Stock Exchange. In order to narrow the exchange rate and improve competition, forex bureaus were licensed in 1995; there are now over 100 bureaus operating in seven locations around Kenya. In March 2007, major private sector advances took place in Kenya, at the time ahead of its regional counterparts. A mobile phone company Safaricom launched the MPesa service for transferring up to KSh35,000 (US$500) between mobile phone accounts.
Regulation of Financial Services
Commercial banks and financial institutions are regulated in accordance with the Regulations and Prudential Guidelines issued under the Banking Act. The World Economic Forum Global Competitiveness Report (2012-2013) shows a moderate score for soundness of banks (5.0) with Kenya ranking above the UK and below Malawi and just below the world mean score of 5.1.
Development of Financial Services
Currently around 10% of Kenyans hold bank accounts (2012). The Microfinance Act (2006) came into force in 2008 to help mobilise savings from the general public. This was expected to significantly improve the financial services available to many Kenyans. The World Economic Forum Global Competitiveness Report (2012-2013) reports an above average score for availability of financial services (4.7) and for affordability of financial services (4.4) with 7 as the highest score. In 2009 there were 73.14 borrowers from commercial banks per 1,000 adults, a string rise from 19.93 per 1,000 in 2004. In 2008 the Central Bank of Kenya started to govern credit reference bureaus in line with the Banking Regulations. This was intended to improve borrowing conditions and reduce fraud by developing a reliable information sharing industry. According to the WEF report, Kenya comes 25th (out of 144 countries) in ease of access to loans with a score of 3.6, well above the world mean of 2.9. Financing through the local equity market in Kenya is strong, with the country ranking, 26th, three places below New Zealand.
