During the launch of the 2019 Economic Update by the Kenya National Bureau of Statistics, Treasury CS Henry Rotich said there was urgent need for the review of our interest rate cap regime. “We need to deal with the challenge of interest rate capping,” he said. Commercial banks had been charging Kenyans as high as 35 per cent interest on loans prior to the rate cap. Despite good intentions, the rate cap law has ultimately hurt low-income populations by limiting their access to finance and reducing price transparency. Since its introduction in 2016, the rate cap has seen bank lending reduce by over 1.2 million loan accounts and SME finance drop by more than Sh13 billion.

Source: The Star April 25, 2019 18:33 UTC