CRDB surpasses rival in lending rates cut

By ABDUEL ELINAZA 

CRDB Bank yesterday cut down borrowing interest rate to 16 per cent from 22 per cent, in a fresh bid to reduce borrowers’ payback burden. The interest rate, however, caters for salary workers in public or private sectors with or without having a bank account with CRDB.

The interest is calculated on reducing rate method. CRDB Managing Director Dr Charles Kimei said, the bank also increased the repayment period from five to seven years and loan size limit uplifted from 50m/- to 100m/-.

“We are considering lowering even further the rate depending on what is happening on the market. “The central bank [Bank of Tanzania) recently reduced Treasury bill and bond rates that opened the door for us to cut down the rates further,” CRDB Chief said in a press conference held in Dar es Salaam.

The rate was softly introduced couple of days ago to open flood gates of customers looking for loans at affordable rate. To accommodate the loanseeking waves, the bank improved its salary lending procedures to issue a loan in a matter of 24 hours after receiving application.

“The bank wants to relieve workers burden of paying loans by extending payback period to increase their purchasing power,” Dr Kimei said. He said, by doing so workers could accumulate capital and venture into development activities thus creating employment and social development.

He said also the bank buys staff loans from other banks as a way of reducing high lending rates charged by other financial institutions. “Those who want CRDB to buy their loans should not fear being penalized by other institutions since it’s against BoT regulation, it is a charge-free issue.

“Those who are charged should report the matter to BoT’s complain desk,” Dr Kimei, who is also Tanzania Bankers Association Chair, said. CRDB Senior Manager Personal Banking Ms Farida Mbwana Hamza said, even though the rate cut was introduced softly some weeks ago, customer influx has increased tremendously.

“We are expecting influx of customers, but our systems have improved to cater for any customer-flood on horizon,” Ms Farida said.

On top of the rate cut, the bank also said those taken the loan will be offered Tembo Card golden and platinum status and will be treated as kings and any of bank’s brick and mortars branches.