CBK to issue new system for pricing loans next week

The Central Bank of Kenya (CBK). PHOTO/FILE 

In Summary

• The Treasury had directed that flexible loans issued from Tuesday be priced using the proposed Kenya Bank Reference Rate (KBRR) framework.
• Central Bank is expected to issue the first KBRR on Tuesday next week after a meeting of its monetary policy committee.
• The rate would apply for six months.

By GEORGE NGIGI
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Loan borrowers will have to wait till next week for a new pricing system that many hope will make credit more affordable.

 

The Treasury had directed that flexible loans issued from Tuesday be priced using the proposed Kenya Bank Reference Rate (KBRR) framework.

Central Bank, which is mandated with calculating the rate that will serve as a standard for all banks is , however, yet to prescribe the new rate.

“It is an implementation challenge rather than an issue of policy. We do not have a KBRR rate yet and we will need to have it,” said Habil Olaka, the chief executive of the Kenya Bankers Association.