Discounts offer to loan defaulters is welcome

Patrick Njoroge

Central Bank of Kenya (CBK) Governor Patrick Njoroge. PHOTO | DIANA NGILA | NMG

The decision by banks to give borrowers who have defaulted on their digital loans a discount of at least 50 per cent on balances is a welcome attempt at finding a win-win solution to the credit crisis that has left more than four million accounts listed by credit reference bureaus (CRBs).

It will help banks and microfinance institutions to recover part of the money that they lent while individuals and businesses that borrowed will have an opportunity to repair their credit scores.

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