Central Bank of Kenya (CBK) dropped the Central Bank Rate (CBR) by a 0.5 % margin from 10% to 9.5% a move reached at during the Monetary Policy Committee (MPC) meeting 19th March,2018.
CBK, the national bank regulator allows a maximum of 4% above the CRB as the interest rate to be imposed on loans by any regulated bank.This means ,lenders will have to drop the interest rates to 13.5% as the new maximum from the previous 14.5% .
MPC reached the conclusion to drop the CBR after noticing postive improvements on various economic factors in banking, forex exchange ,food and non food prices, inflation among other factors.
We should therefore expect interest rate imposed on new credit facilities now be around 13.5% as the maximum from any of the registered banks in Kenya .
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