The revelation that some top lenders are yet to adjust charges on customer loans, two months after the Central Bank of Kenya (CBK) lowered its benchmark rate, raises questions on the ethical culture of business.
Market enquiries indicate that some key banks are still charging 13 percent on customer loans despite the Central Bank Rate (CBR) having been cut from nine to 8.5 percent in November and further lowered to 8.25 percent following a meeting of the Monetary Policy Committee (MPC) on Monday.
In the spirit on the repealed Section 33B of the Banking Act, these cuts on the CBR should translate to some relief on the cost of borrowing.
Unfortunately, whilst some lenders lowered their charges on loans, others have stuck to the old higher terms — effectively denying borrowers the respite they deserve and need to boost their liquidity or shorten their loan repayment periods.
This doesn’t augur well for the image and long-term outlook of banks.
EK on Marketing 