Lending to the private sector by commercial banks grew by four percent in the year to June 2024 compared to 13.9 percent at the beginning of the year, the slowest pace in five years, hurt by the effect of a stronger shilling on foreign currency loans and reduced borrowing capacity by businesses and households due to higher interest rates.
This is the slowest pace that private sector credit has expanded in percentage terms since February 2019 (3.4 percent), when lending to the private sector was still under the constraints of the rate cap.
