The Kenya Revenue Authority (KRA) will begin accessing suppliers’ bank account transactions starting July 2025 as part of a new initiative to tighten oversight on government procurement processes. This development comes with the rollout of an upgraded electronic government procurement (e-GP) system, designed to integrate financial and tax data from banks and KRA’s tax platform to verify suppliers’ financial capacity and tax compliance in real time.
Announced by Treasury Principal Secretary Chris Kiptoo, the enhanced e-GP system aims to combat tax evasion, eliminate fraudulent companies, and ensure that only financially sound and tax-compliant firms are awarded government contracts. Given that government procurement in Kenya accounts for approximately Sh 2.5 trillion annually, this move is expected to improve transparency and accountability in public tendering significantly.
e-GP System Integration and Functionality
The revamped e-GP system will link directly with commercial banks to access suppliers’ bank account transactions, and with KRA’s iTax platform to verify tax compliance, including tax filing history and payment records. Additionally, integration with other government financial systems like the Integrated Financial Management Information System (IFMIS) is planned to allow seamless tracking of procurement payments and processes.
Read: Why Kenyan Banks Are Pushing Back Against KRA’s System Integration Mandate
Unlike previous processes, where tax verification and financial checks occurred post-payment, the new system will enable real-time monitoring of supplier payments and tax obligations. Tender evaluation committees will have direct access to accurate financial data during the bid evaluation stage, helping to weed out firms that fail to meet tax compliance standards or that inflate their financial standing to win tenders.
Fighting Tax Evasion and Fraudulent Firms
The primary objective of this initiative is to combat tax evasion linked to government contracts. KRA has identified tactics such as the submission of fake invoices or failure to remit withheld taxes as common evasion strategies. KRA will be able to identify discrepancies and flag suspicious suppliers for investigation by reconciling bank transaction data with declared income.
Furthermore, the system aims to eliminate “front” companies or shell firms that misrepresent their financial capacity to secure lucrative government tenders. Access to suppliers’ bank account data will allow procurement officials to verify genuine financial strength, addressing longstanding concerns about firms inflating financial statements or subcontracting tenders improperly.
Supporting Developments and Legal Framework
KRA’s has already integrated its iTax system with government platforms like IFMIS, the Government Human Resource Information System (GHRIS), and the Central Bank of Kenya (CBK), which have collectively enhanced tax collection from public sector payments. In the year leading to June 2024, these efforts contributed Sh 99.24 billion in taxes.
Read: Here Is Why KRA Plans to Access Your M-Pesa Balance
The Finance Bill 2025 further supports this initiative by proposing to remove legal barriers that currently require KRA to obtain court orders to access private financial data, including bank and mobile money transaction details. If enacted, this legal change will facilitate smoother implementation of the e-GP system’s real-time data access capabilities.
Additionally, KRA’s Electronic Tax Invoice Management System (eTIMS), which enforces real-time VAT invoice reporting, has already improved domestic VAT collections by over 15% in the 2023/24 fiscal year. The new e-GP system builds on this digital foundation to ensure enhanced compliance and financial transparency in government procurement.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.