Kenyan Regulator Bans Unlicensed Brokers from Using M-Pesa

The Central Bank of Kenya has issued a notice to all payment service providers in the country to cease offering services to unregulated brokers, Finance Magnates has learned.

Though the regulator is yet to publically notify anything on the ban, at least one of the unlicensed brokers with services in Kenya has ceased taking deposits using the widely used M-Pesa.

Additionally, the brokerage is requesting its customers to withdraw all funds from the live accounts using M-Pesa and then using Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term or Skrill for further deposits and withdrawals.

Finance Magnates reached out to both the Central Bank of Kenya and the Capital Markets Authority of Kenya to confirm the move but did not receive any reply as of press time. We will update the story accordingly.

The Final Nail on the Coffin

The Kenyan regulators are continuously warning against all online FX brokers or money managers that are operating in the country without a proper license and ordering them to cease and desist from trading and onboarding clients from Kenya. However, many are still offering services.

At present, there are only three regulated brokers in Kenya: EGM Securities, which is the Kenya-based operations of Equiti Group and locally trading as FXPesa; SCFM Limited, trading as Scope Markets; and Pepperstone Markets Kenya Limited.

Now, after many warnings, the regulator’s attempt to curb the payment companies' services seems to be an effective move.

“...fraudulent unregulated entities styling themselves as online foreign exchange (Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term) brokers and traders have also emerged,” the central bank stated in a notice published on August 25, 2020. “These entities promise customers huge returns and are not licensed as required...These rogue entities seek to exploit Kenyans and pose Money Laundering and Financing of Terrorism risks to the financial sector.”