True, a market economy would make it possible for banks to charge interest rates based on the credit-worthiness of a potential borrower. True, a market economy would make it possible for banks to charge interest rates based on the credit-worthiness of a potential borrower. It is also likely to increase access to loans for small and medium enterprises, as the CBK has said. LOANSHowever, in the past, banks have not demonstrated sufficient restraint in the pricing of loans. It had been hoped that by setting a ceiling pegged on the CBK rate banks would offer cheaper loans.

Source: Daily Nation September 14, 2017 18:11 UTC