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KDC to review interest on 1960s defaulted loans
A soft economy has triggered job losses and cash flow crunch in firms, which, together with high lending rates, have caused hardship for borrowers in Kenya’s banking industry and increased loan defaults.
A State-owned development financier is seeking to write off interest and penalties on defaulted loans tapped as far back as the 1960s that have ballooned to over Sh31 billion.
The Kenya Development Corporation (KDC) wants to apply the in-duplum rule, which provides that interest on a loan stops accumulating when it equals the principal, according to a management report seen by the Business Daily.
