A Microfinance Bank (MFB), also known as a Deposit-Taking Microfinance Institution (DTM), is an institution licensed by the Central Bank of Kenya (CBK) under the Microfinance Act, 2006, to accept deposits from the public and extend credit, principally to low-income individuals, micro-enterprises, and small businesses.
Licence Fees
| Fee Item | Amount (KES) |
|---|---|
| Application / licensing fee | Payable by banker’s cheque to CBK (amount per CBK schedule) |
| Annual licence fee | Per CBK schedule for DTMs |
Exact fee amounts are specified in the CBK’s DTM licensing procedures document and the Microfinance (Deposit-Taking Microfinance Institutions) Regulations. Applicants should confirm the current schedule directly with the CBK’s Bank Supervision Department.
Minimum Core Capital Requirements
| DTM Category | Minimum Core Capital (KES) |
|---|---|
| Community MFB (defined geographical area) | 20,000,000 |
| Nationwide MFB | 60,000,000 |
These thresholds are prescribed under the Microfinance Act, 2006, and its associated regulations.
Key Application Requirements
| Requirement | Details |
|---|---|
| Feasibility study | Required, covering first three years |
| Paid-up capital evidence | Confirmed by external auditors |
| Directors and officers | Must pass CBK fit and proper test |
| Business plan | Detailed operational and financial plan |
| Deposit mobilisation strategy | Required |
| IT systems plan | Required; CBK may conduct on-site systems review |
| CBK inspection | On-site inspection before licence issuance |
The licensing process for a Microfinance Bank typically takes between 6 and 18 months from application to licence issuance, reflecting the depth of CBK due diligence on governance, capital, and operational readiness.
Regulated by the Central Bank of Kenya (CBK) under the Microfinance Act, 2006, Laws of Kenya.