Kenya’s parliament to discuss a bill seeking to grant its citizens cheaper loans
Kenya’s parliament will on Thursday debate The Banking (Amendment) Bill which seeks to grant Kenyans cheaper loans and higher returns on deposits.
According to The Star, the bill seeks to give the Central Bank of Kenya powers to enforce interest ceilings on both loans and deposits on local banks.
If passed, no bank would charge interests on loans at more than four per cent above the CBK’s base rate and must set minimum interest rate granted on a deposit, at least, seven per cent.
“A person shall not enter into an agreement or arrangement to borrow or lend directly or indirectly at an interest rate in excess of that prescribed by law,” it states.
A financial institution that contravenes the provisions shall, on conviction, be liable to a fine of not less than one millions shillings, or to imprisonment for a term not less than one year, or both.
