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Sacco members have higher credit scores and pay lower rates on loans
In credit transactions, Saccos use guarantee models to generate collective responsibility, which also acts as an internal control system that boosts borrower behavior.
On December 1, Kenya’s banking sector shifted to a new interest rate pricing regime. Banks have since issued public notices through the newspapers, emails, SMSs and posts in their websites, notifying their customers and the general public of the change in how the cost of borrowing will now be determined.
The news is, for the first time in Kenya's financial history, the interest rate a borrower pays will be significantly influenced by their own individual behaviour, discipline and overall creditworthiness, as determined by their credit score.
