Bankers urge Uhuru to reject law capping interest rates

President Uhuru Kenyatta attending the Energy Summit held at State House in Nairobi on July 27, 2016. Bankers have urged him to veto la Bill seeking to cap interest rates. PHOTO | EVANS HABIL | NATION MEDIA GROUP

What you need to know:

  • A statement from the Kenya Bankers Association (KBA), the umbrella body of commercial banks in the country, said they are working to lower interest rates without the need for legislation.
  • MPs who supported the Bill and traders have argued that banks have been using the current regime, which gives them a free hand in determining interest rates, to rake in profits at the expense of borrowers.
  • But in seeking to pre-empt the passage of the Bill, banks, which argue that limiting interest rates will in fact raise the cost of credit, issued a statement last week in which they offered to create a Sh30 billion loan kitty for small businesses.

Bankers on Tuesday evening continued to lobby President Uhuru Kenyatta not to sign a proposed law that could cap interest rates.

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