The Central Bank of Kenya (CBK) has moved to reassure traders and business owners that older Ksh500 banknotes remain valid, amid growing confusion and reports of customers rejecting the currency.
The clarification comes after a viral complaint by a trader who said customers were refusing to accept the older series Ksh500 note, triggering widespread debate about which banknotes are still legal tender in Kenya.
“To businesses that encounter customers who don’t want to interact with old banknotes, talk to them and make them understand that these still remain legal tenders,” a CBK official said.
“If it becomes a big problem, then visit the nearest bank and get the new generation banknotes.”
The regulator maintained that all Ksh500 notes currently in circulation- both old and new series- remain legal tender and should be accepted for transactions.
Viral Video Sparks Confusion
The advisory follows a widely circulated video of a businesswoman lamenting that customers and even suppliers were rejecting the older Ksh500 notes.
In the clip, she complained that once she receives the notes, she struggles to use them, as others fear they will also be rejected further down the transaction chain.
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She called on CBK and the government to consider fully scrapping the old notes instead of allowing them to continue circulating amid public uncertainty.
CBK Explains Phase-Out Process
In response, CBK clarified that while older banknotes are gradually being phased out, there is no fixed deadline for their removal from circulation.
“Once we receive the old series notes, we are not releasing them to the market again; instead, we release the new series notes,” the official explained.
“Though there is no timeline to entirely remove the older notes, it will just happen over time.”
The bank noted that older notes naturally exit circulation when deposited in commercial banks, which then issue newer series notes instead.
Which Notes Are Still Valid?
CBK emphasized that all Ksh500 notes- regardless of series- remain valid and must be accepted as legal tender.
The only denomination that was demonetized is the old KSh1,000 note, which was withdrawn in 2019 as part of a broader currency overhaul aimed at curbing illicit financial flows.
No other denominations, including KSh200 and KSh500 notes, were affected.
The regulator urged traders and the public to familiarise themselves with valid Kenyan currency to avoid unnecessary rejection of legitimate money.
It also encouraged Kenyans holding older notes at home or in businesses to return them into circulation through everyday transactions or by depositing them in notes.
