The Kenya Banker’s Association (KBA), the umbrella body of the institutions licenced and regulated by the Central Bank has welcomed the repeal of the interest cap rate which the president assented to on the 7th of November 2019.
The association sees the repeal giving banks an opportunity to direct more capital to the private sector in line with the new risk-based pricing regime that will now be articulated in the Banking Sector Charter.
Related; Parliament Adopts Proposal to Remove Rate Cap Law
Following the amendment of the Finance Act 2019 that consists of the removal of the interest cap rates, all the existing loan contracts are to be maintained under the same terms and conditions before the repeal.
KBA has assured a continuous engagement with policymakers including the legislature, Central Bank of Kenya, the National Treasury, as well as private stakeholders and ensure that banks play their role in ensuring Kenya’s sustainable economic development.
Kenya Bankers chairman Joshua Oigara, who is also the chief executive of KCB Group has assured that lenders will act responsibly by enhancing price transparency while supporting enterprise development and the MSME sector.
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