CBK Moves to Enforce Risk-Based Credit Pricing Model

The Central Bank of Kenya (CBK) says banks that have not lowered their lending rates in line with the Risk-Based Credit Pricing Model (RBCPM) will be penalized.

Speaking during a press conference, today, CBK Governor Kamau Thugge stated that onsite inspections are currently being undertaken. He pointed out that despite significant reductions in the Central Bank Rate (CBR), lending rates had only declined marginally.

Thugge emphasized that banks must take necessary measures to further reduce their lending rates noting that it is crucial to stimulate private-sector credit growth and enhance economic activity.

The CBK governor warned that any institution failing to pass on the benefits of reduced borrowing costs to consumers will face regulatory action.