Preasure is pilling on big banks in Kenya to cut lending rates, as three comply. Commercial Bank of Africa, I&M Bank and StanChart are ready to act in line with reduction of Kenya Banks Reference Rate (KBRR). “KBRR component of our interest rate will stand reduced to 8.90 per cent per annum with effect from Aug 25” We look forward for the rest of the banks to reduce their rates. This will be a big boost to investors both in the country and in the diaspora.
Will it impact those who have mortgages? Due to the outstanding law in borrowing, those with fixed-rate mortgages usually don’t benefit from any cut until their deal expires. Customers on normal mortgages, however, will benefit immediately as their mortgage rate is linked to the central base rate. The reduced rate means that repayments on normal mortgages will fall as well.