CFC Stanbic bank Kenya and KCB Group have adopted the new lending rate of Base Rate + 400 basis points currently at 14.5 percent per annum on all new loan and exciting facilities.
“It is in the same spirit that we will be re-pricing our existing savings/loan facilities to align with the new law. As we adopt the new rates, we will adjust our strategies to ensure that we keep creating value for our customers, shareholders and investors,” Philip Odera, CfC Stanbic Bank, C.E made the announcement at media briefing in Nairobi.
The bank becomes the sixth to comply with the Banking (Amendment) Bill, 2015 capping bank interest rates at 4% below the Central Bank Rate.
Joshua Oigara, KCB Group CEO later on Wednesday followed suit and said their branches will adjust all existing loans to not more than 14.5 percent even as they work closely with the Central Bank of Kenya on the final regulation.
“Both new and existing loans will enjoy the 14.5% cap on rates and we urge customers to get in touch with their branches from tomorrow to review and amend their banking facilities documents to reflect the new interest rate regime,” said the Group CEO and Managing Director, Mr. Joshua Oigara.
Both KCB and CFC Stanbic bank Kenya have committed 5 percent of their loan book to support SMEs through the Kenya Bankers Association (KBA) Inuka programme for 3 years.
“Through the Inuka programme, women and youth will enjoy 14.5 percent interest rate once their credit applications are successful,” said Oigara.
Other banks that have complied include: Chase Bank Kenya (IR), Cooperative Bank of Kenya, and Barclays Bank Kenya.
The support to Micro, Small and Medium Sized Enterprises through the Inuka Enterprise SME Development Program will see banks commit Ksh 30 billion worth of capital extended to SMEs at preferential rates. Of this, Ksh 10 billion will be allocated to women and youth-owned businesses.