•Njoroge has said much money held was been pushed to deposits, saying Sh149.69 billion of the new generation has been in circulation as at the deadline.
•The CBK's governor has said there is little or no amount of money that has slipped into the system.
About Sh7.38 billion value of in Sh1000 notes is wealth that lost to owners holding it, Central Bank of Kenya governor Patrick Njoroge has said.
In a briefing after demonetisation process, as at September 30, Sh209.6 billion (209.661 million pieces) had been exchanged out of Sh217 billion (217 million pieces) in circulation as at June when the process was announced.
Therefore, Sh7.386 billion are still held by individuals as worthless money.
“The amount could be store of value by the individuals and has been stashed, not helping create an impact in the economy,” added.
"So whoever was holding the money is poorer by the same amount,” he added.
The withdrawal of the highest legal tender in the market was meant to curb money laundering and counterfeiting.
Over the four months, 3172 suspicious transactions were flagged though attempted exchanges among other in banking institutions, forex bureaus and micro-finance banks.
CBK conducted 15 targeted inspections to ensure that all financial institutions adhere to regulations in enforcing the exchange and transactions regulations.
Njoroge says there is little or no amount of money that has slipped into the system.
"The process has put out monies from questionable source of income that owners would not want to declare as in cash in banks," he said.
Njoroge has said much money held was been pushed to deposits, saying Sh149.69 billion of the new generation has been in circulation as at the deadline.
In the month of August, over 161 million transactions were made through cheques, money transfer payments and Electronic Fund Transfers.
In terms of transaction, 96 per cent were less than Sh500,000. About 99 per cent were less than Sh1 million.
About 62 per cent of exchanges were in value of less than Sh500, while 79 per cent were made in less than Sh1 million in amounts.
“There were people holding money that they would otherwise hold them but now it has been pushed them into deposits,” Njoroge said.
Njoroge has maintained that the move will no in any way lead to a contraction in the money supply.
“There was a move in Central Banks' balance sheet and after there will be another move to cover the gap of Sh7.38 billion. It does not affect the monetary policy and we are okay with the outcome of the process,” Njoroge said.
“The move is not material. The Central Bank has a positive effect on its balance sheet in the amount that was extinguished,” Financial analyst Alykhan Satchu said.
The other notes of Sh50, Sh100 and Sh500 in denominations will be changed in the regular mechanism by withdrawing when they get dirty or old.
Njoroge has said the process gives a start for other agencies especially Kenya Revenue Authority is targeting tax evasion.
The demonetisation is expected to reduce cash transactions and help the country move to a cashless economy.