Kenya VASP Licensing & Compliance Resource Centre
The central hub for licence categories, CBK/CMA jurisdiction, costs, AML and the transition deadline.
Read insight →The Virtual Asset Service Providers Regulations, 2026 place governance and fit-and-proper standards at the centre of the licensing assessment, consistent with the approach taken across Kenya's regulated financial sector generally. A well-governed applicant with modest technology is often a stronger candidate than a sophisticated platform with weak governance.
Board composition
Applicants should expect scrutiny of board composition proportionate to the scale and risk of the licensed activity: whether directors collectively bring relevant financial services, technology, risk and compliance expertise, and whether the board is capable of independent oversight of management rather than functioning as a rubber stamp. Independence expectations, where they apply, should be confirmed against the specific licence category, since requirements may scale with the size and systemic significance of the business.
Directors and senior management
Each director and senior officer is generally assessed individually for fitness and propriety, covering:
- Integrity. No history of fraud, dishonesty or relevant regulatory sanction.
- Competence. Relevant qualifications or experience for the role held.
- Financial soundness, where relevant to the role, such as no history of insolvency associated with mismanagement.
Significant shareholders and beneficial owners
Beyond the board, regulators are likely to look through to significant shareholders and ultimate beneficial owners, assessing their identity, source of funds, and any history that would raise integrity concerns. Complex or opaque ownership structures should be simplified and fully disclosed before an application is filed, since incomplete beneficial ownership disclosure is a common source of delay.
Governance framework and committees
Beyond individual fitness, applicants should have a documented governance framework: how the board oversees risk, compliance and technology; what committees exist (audit, risk, or a combined committee for smaller applicants); and how conflicts of interest, including between the business and its own directors or major shareholders, are identified and managed.
Notifying material governance changes
Once licensed, VASPs should expect an ongoing obligation to notify, and in some cases seek prior approval for, material changes to directors, senior officers, or significant ownership. Building an internal process for flagging these changes early avoids inadvertent breaches of licence conditions.
Common application deficiencies
- Incomplete or inconsistent beneficial ownership disclosure across corporate layers
- Directors without documented experience relevant to a virtual asset business
- No documented process for board oversight of the compliance and risk functions
- Conflicts of interest, particularly with major shareholders, left unaddressed in governance documents
A practical readiness checklist
- Map your full ownership structure down to natural-person beneficial owners
- Document each director and senior officer's relevant experience and any required declarations
- Confirm your board and committee structure against the expectations for your specific licence category
- Put a documented conflicts-of-interest policy in place before filing
Mid-article: not sure your governance structure is ready?
Not sure which licence applies, or whether your governance structure will satisfy fit-and-proper review? We assess board composition, ownership structure and governance documentation against regulatory expectations before an application is filed.
Request a governance readiness reviewFrequently asked questions
Do all VASP licence categories require independent directors?
Independence expectations should be confirmed against the specific licence category and the scale of the business; requirements are not necessarily uniform across every category and may scale with systemic significance.
What happens if a director fails the fit-and-proper assessment after a licence is granted?
Licensees should expect an ongoing obligation to notify the regulator of material governance changes, and a director later found not to meet fit-and-proper standards would generally need to be addressed through removal or remediation to protect the licence.
Does a foreign director need to meet the same fit-and-proper standard as a Kenyan director?
Yes. Fit-and-proper assessment generally applies to all directors and senior officers regardless of nationality or residence, though supporting documentation and verification processes may differ for foreign nationals.
Key legal sources
- Kenya Law — Virtual Asset Service Providers Act, 2025 (Act No. 20 of 2025)
- Kenya Law — Virtual Asset Service Providers Regulations, 2026 (Legal Notice No. 134 of 2026)
- Central Bank of Kenya and Capital Markets Authority public guidance on VASP licensing
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Read insight →The information on this website is general in nature, is not legal advice, and does not create an advocate-client relationship. Figures, fees, capital thresholds and procedural requirements under the Virtual Asset Service Providers Act, 2025 and the Virtual Asset Service Providers Regulations, 2026 should be confirmed against the current Gazette text and regulator guidance before action is taken. Regulatory requirements may also be supplemented by subsequent guidance, notices or licensing requirements issued by the CBK or CMA. Please contact Njau & Associates Advocates for advice on your specific circumstances.