Banks will now be at liberty to set their own interest rates after MPs failed to overturn President Uhuru Kenyatta’s reservations in the Finance Bill, 2019.
According to speaker Justin Muturi, the MPs were unable to raise the required quorum to retain interest caps.
Only 160 MPs were present out of the required 233 votes needed to retain the caps in a bill introduced by Kiambu MP Jude Njomo.
The head of state had argued that the caps ended up causing “unintended effects that are significant and damaging to our economy.”
The 2016 legislation amended Section 33B of the Banking Act to cap the interest rates chargeable by banks tp a rate that is not higher than 4% of the Central Bank Rate (CBR).
In a memorandum sent to MPs, Uhuru argued that the caps had forced banks to change their focus from SMEs to large corporate borrowers.
“It is apparent that the capping of interest rates has caused unintended effects that are significant and damaging to our economy and in particular, the Micro Small and Medium Enterprises (MSMEs) which are the hardest hit,” read part of the memo.
According to Citizen Digital upon the signing of the Finance Bill by President Kenyatta, new interest rates charged on loans will be left to the discretion of banks.
Anonymous says
I AM, how we pray that you personally delete this son of a thief from the face of the earth.
His regime from abyss should come to an end and let his and his crooks/cartels never have any public office.
I AM, the citizen of Kenya have had enough of the election thief and we call upon you to remove him from presidency of Kenya. Let him see no peace.
I AM, our country does not need Mr Uhuru and his cartel running the affairs of Kenya from this moment forward.
I AM, let it come to pass. In JESUS NAME, we pray. Amen and Amen.