Kenyan Shilling (KES)

About the Kenyan Shilling

The Kenyan Shilling (KES) is the official currency of Kenya, issued by the Central Bank of Kenya and written with the symbol KSh. One shilling divides into 100 cents. Under Article 231(2) of Kenya's Constitution and the Central Bank of Kenya Act, the Bank formulates monetary policy, promotes price stability and holds the sole right to issue the country's banknotes and coins, which by law are the only legal tender in Kenya.

Kenya's exchange rate arrangement has changed twice since independence: a fixed rate held from 1966 to 1982, a crawling peg followed from 1983, and the free float introduced in 1993 remains in force today. Each shift moved rate-setting further from the Central Bank and closer to the market — under the float, licensed commercial banks and forex bureaus negotiate rates directly with each other and their customers, rather than transacting at a level the Bank fixes.

The shilling reached East Africa in 1922, when the London-based East African Currency Board introduced it to replace the Indian rupee at two shillings per rupee. Kenya began issuing its own currency after independence: the Central Bank of Kenya Act legalised Kenyan banknotes from 1 July 1966, the first entering circulation that September bearing President Jomo Kenyatta's portrait, with coins following in April 1967. East African Currency Board banknotes lost legal-tender status in September 1967, and its coins were demonetised in April 1969.

Kenya's currency was redesigned to meet the 2010 Constitution's requirement, in Article 231(4), that notes and coins bear no individual's portrait: coins with new security features entered circulation in December 2018 and banknotes in June 2019. The pre-2019 1,000-shilling note, then the highest denomination, lost legal-tender status by Central Bank of Kenya gazette notice effective 31 May 2019. Circulating notes now run 50 to 1,000 shillings and coins 50 cents to 40 shillings, the top coin dating to a 2003 commemorative issue marking 40 years of independence.

The exchange rate the Central Bank of Kenya publishes each day is an indicative reference, not a rate it sets: it is calculated as the weighted average of registered spot trades executed in the interbank foreign-exchange market during that day's trading session. Commercial banks and forex bureaus, established from 1995, then quote their own buying and selling rates independently within this market, so the shilling's retail price for cash or transfers varies from one bank or bureau to another.