Central Bank, which is opposed to capping rates saying it could cause banks to restrict lending, asked banks to cut rates urgently last week to win back customer's trust. Kenyan lenders have promised to immediately cut loan rates by 100 basis points, part of measures to lower borrowing costs and see off the threat of a legislative cap on rates. Businesses often complain that high commercial lending rates, which can reach 18 per cent or more, hobble corporate investment. The average lending rate was 18.2 per cent last month, compared with 15.8 per cent in July 2015, Central Bank said. CBK cut its policy rate to 10.5 per cent in May, having left it at 11.5 per cent since July 2015.

Source: The Star August 10, 2016 13:18 UTC