CBA Must Take M-shwari Interest Rate Down To 14.5pc Per Annum

The Consumers Federation of Kenya(Cofek) on Thursday asked commercial Bank of Africa(CBA) to cap interest rate on its mobile based loan,M-shwari to 14.5%pa to be in line with the new banking law.

The lender however,seem fixed on its ground claiming that there's no such a thing like 'interest' that the m-shawari facility charges on borrowers.The 7.5% is a facilitation fee.
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"There is no interest levied on M-Shwari loans. What we have is a one off facilitation fee of 7.5 per cent charged at disbursement,” Mr Eric Muriuki, the general manager new business ventures at CBA told the Nation
“Furthermore, our loans last only 30 days compared to competing products that have longer tenures,” he said
KCB and Equity already adjusted their mobile based loans to a maximum of 14.5% per annum interest rate.


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