Switching banks in Kenya is a manual process that requires customers to handle all steps themselves, as there is no automated account-switching system.
According to the Competition Authority of Kenya (CAK), unlike countries with centralized switching services, Kenya does not have a centralized service that automatically transfers salaries, standing orders, or bill payments without customers’ intervention.
In the banking sector, switching accounts takes different forms, including full switching with account closure, partial switching, in which the old account remains dormant, and multibanking, in which customers maintain multiple active accounts.
However, multibanking is the common form, with many customers preferring to leave old accounts open with zero balances rather than formally closing them.
How to Switch Banks in Kenya Step by Step
Customers intending to switch banks must open an account with the new bank, transfer their funds, update all standing orders and payment instructions, and then formally close their old account.
- Open Bank Account
Opening bank accounts in Kenya has become easier, as Most major banks now offer fully digital account opening.
To use online services, they will be required to provide personal details and upload the necessary documents, including a National Identification Card or valid passport, a Kenya Revenue Authority (KRA) PIN certificate, and, in some cases, proof of income or address.
Once the application is submitted, the bank conducts verification via phone calls with either instant approval or completion within a few hours.
Therefore, the customer receives a new account number digitally and can start using the account immediately.
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2.)Transition of Money Within Banks
Once the new account is active, the customer must transfer funds using PesaLink and update all financial arrangements to ensure a smooth transition between banks.
PesaLink is a real-time interbank transfer system operated by the Kenya Bankers Association that enables instant transfers between Kenyan banks via mobile apps, internet banking, or USSD.
These transfers are typically low-cost or free for small amounts, with limits up to KSh 999,999 per transaction.
Beyond transferring funds, customers must also redirect all recurring payments, including updating salary or employer deposits, standing orders, loan repayments, utility bills, school fees, and any linked mobile money or financial services.
To avoid disruptions, it is also advisable to maintain a small balance in the old account for at least one to two payment cycles.
This ensures that any pending transactions are successfully processed during the transition period.
What happens in the closing of the old bank Account
Before closing an old bank account, customers must ensure that all financial obligations linked to it are fully settled to avoid future complications.
This includes clearing up any outstanding loans or overdrafts, ensuring that all pending transactions or cheques issued have been processed, and paying any remaining bank fees or charges.
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Once everything is in order, the customer must formally initiate the closure process by contacting the bank and submitting an official account closure request, either in writing or through the bank’s prescribed procedure.
If a customer is in possession of any bank-issued items, such as ATM or debit cards, cheque books, and any other account-related materials, they are required to return and settle any final charges that may apply.
Upon completion, the bank may issue a formal confirmation letter indicating that the account has been successfully closed.
This process usually takes one to four weeks, depending on how quickly recurring payments are updated.
