Equity Bank Kenya has cut down its lending rates to 14.5% on all existing and new loans, in compliance with the Banking (Amendment) Act 2016. This comes after the Central Bank of Kenya clarified the amendment, setting the Central Bank Rate as the base rate.
The new lending rates by the bank will also apply to all loans through mobile phones, credit card facilities as well as micro-finance loans.
The Banking (Amendment) Act 2016, which was amended last month after it was passed by parliament and signed into law by the president Uhuru Kenyatta, capped all interest rates at 4% above the base rate.
The Nairobi listed commercial bank also set the interest applied on local currency interest bearing accounts at 7.35% p.a. in line with the 70% cap on the base rate on deposits, while urging all customers to capitalize on these products to capitalize on savings and investments.
Equity Bank, which remains the largest bank in customer base with over 10 million customers, says it will focus on innovation and digitization to build its returns which saw the lender disburse over 80% of their loans through the group’s mobile platform Equitel in the half year, with 2.2 million customers in the half year 2016.
The bank posted an 18% rise in profits to Ksh10.1 billion for the half-year 2016 and saw deposits rise to KSh320 billion, while its loan book dropped to KSh269.032 billion from 269.893 billion last year.
BY: Humphrey Ngugi H_NGUGI