Banks rates rise sparks loans buyoff by saccos

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Savings and cooperative organisations (Saccos) are buying off bank loans from members. FILE PHOTO | FOTOSEARCH

Savings and cooperative organisations (Saccos) are buying off bank loans from members spooked by the upward revision of rates by lenders switching to risk-based pricing models.

Multiple sacco leaders told the Business Daily that they are witnessing a surge in inquiries to transfer their loans from banks to saccos in an arrangement that seeks to shield borrowers from rates of as high as 18 percent.

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