The Central Bank of Kenya and the National Bank of Rwanda have signed a memorandum of understanding to develop a licence passporting framework for payment service providers, a move aimed at simplifying how fintech firms and digital payment companies expand between the two markets.
The agreement outlines steps toward a system where payment firms licensed in one country could operate in the other with fewer regulatory hurdles, reducing the need for duplicative approvals while maintaining oversight by both regulators.
The two central banks said the framework would promote mutual recognition of licensing regimes for payment service providers, enabling responsible cross-border expansion while preserving regulatory supervision and cooperation between the authorities.
The initiative is aligned with the regional integration agenda of the East African Community, particularly the EAC Cross-Border Payment System Masterplan, which seeks to create a more integrated and efficient regional payments landscape.
Regulatory fragmentation has historically slowed the expansion of digital payment services across East African markets, forcing fintech firms to obtain separate licences in each jurisdiction.
By introducing a passporting framework, regulators aim to address these barriers while encouraging innovation and improving the efficiency of cross-border financial services for businesses and consumers.
The Central Bank of Kenya said the initiative reflects its commitment to strengthening regional cooperation and ensuring that payment infrastructure continues to evolve alongside the needs of the region’s digital economy.
If implemented successfully, the framework could pave the way for broader harmonisation of payment regulations across the East African Community, potentially enabling fintech firms to scale services across multiple markets more easily.