Most Kenyan banks continue to offer new loans at an annual interest rate of 13 percent even after the removal of lending controls allowed them to raise prices on credit facilities.
This is according to the Kenya Bankers Association (KBA) and the Central Bank of Kenya (CBK) portal — www.costofcredit.co.ke — which was created to boost transparency in loan pricing.
Only a few lenders, such as Spire Bank have raised their interest rate to a range of between 13.5 percent and 14 percent, according to the website.
It was not immediately clear whether all the banks have updated their actual lending charges on the portal.
CBK has written a circular to banks, asking them to disclose all their product fees on the website to enable customers make informed decisions.
“The cost of credit website and mobile app launched in 2017 was a good start in enabling customers to ‘window shop’ for personal loans and mortgages,” the regulator said in the circular.
“Going forward, more products need to be incorporated and the customer experience enhanced.”
A bank executive told the Business Daily that more lenders would start to charge more on loans from the first quarter of next year, adding that this would be driven by the launch of new products and entry into new market segments. He added that banks and CBK have agreed that changes in lending rates will now be more closely tied to swings in macroeconomic factors like inflation and the rates on short term government debt.