What is the KES or Kenyan Shilling?

The Republic of Kenya’s national currency is the Kenyan shilling (KES). It is utilized in Somalia, Kenya, and Sudan. Nonetheless, the Somali Shilling and the Sudanese Pound are the recognized currencies of Somalia and Sudan, respectively. There are 100 cents in one Kenyan shilling or 890 p-‘. The currency symbol KSh is frequently used in prices, such as “100 KSh” to denote 100 shillings. The sign used to trade foreign exchange (FX) is KES.

The Kenyan Shilling (KES): An Overview

After peaking at roughly 75 shillings per US dollar in 2009, the KES/USD exchange rate declined over the following few years, falling to roughly 104 shillings per dollar in 2015 and again in 2017.

Concerns over the amount of public debt Kenya has accrued over the years have led to the Kenyan shilling staying stable at 100 against the US dollar since 2016. On September 1, 2022, USD 1 will equal about 120 KES.

In East Africa, the Kenyan shilling is one of the most stable currencies. Neighboring nations like Somalia and Sudan are frequent destinations for it. The Kenyan shilling’s value relative to the US dollar has usually declined during the last ten years, albeit less erratic than other regional currencies.

The Kenyan shilling replaced the East African shilling in 1966. From the 1920s through the early 1960s, when Kenya and other African nations gained independence from British domination, that currency was used in East African territories under British authority.

2018 saw Kenya introduce new coins and banknotes due to recent constitutional amendments prohibiting depicting specific individuals in portrait form.

Kenya’s Central Bank controls the country’s currency and permits free movement of exchange rates on the international foreign exchange market.

The country’s financial system must remain liquid, prices must remain stable, and the central bank must encourage employment and growth.

KES and the Economy of Kenya

The desire of people and institutions to hold assets denominated in shillings has a significant role in determining the relative value of a currency, such as the Kenyan shilling, relative to other currencies. Other trading partners view Kenya’s potential for economic growth and stability differently, which impacts this.

According to the World Bank, Kenya’s gross domestic product (GDP) grew at an annual rate of 5.8% in 2016, despite the country’s stagnant economy in recent years. Kenya’s economy is among the fastest-growing in Sub-Saharan Africa based on its annual growth rate of only 5.4% in 2019. The rise in tourism and infrastructure investment in Kenya is mainly responsible for the country’s GDP development.

Kenya’s GDP, which is also expressed in U.S. dollars, more than doubled, rising from $25.8 billion to $70.5 billion between 2006 and 2016, according to data from the World Bank. The country’s gross national product also doubled during that time. The warning is that, compared to 2013, Kenya’s governmental debt as a percentage of GDP is currently 60%, up from 40%.

“M-Pesa”

With the mobile banking app M-Pesa, customers may save and transfer money using their phones. M-Pesa was introduced to give the people of Kenya an alternate method of obtaining financial services. 2007 saw the introduction of M-Pesa by Safaricom, the most prominent cellular provider in Kenya. The name of the service is a combination of two words: M stands for mobile, while Pesa, in Swahili, indicates money or payment.

M-Pesa payments are made into bank accounts that Safaricom owns. The Deposit Protection Fund insures the bank accounts up to a limit of 100,000 KES, or about $1,000, and they function as standard checking accounts.

Conclusion

• Kenya, Sudan, and Somalia are all in Africa, and their currencies are the Kenyan shilling (KES).
• The Kenyan shilling (KES) is still one of the most safe currencies in East Africa.
• People in nearby countries use KES to keep their money because it is safer than their currencies.