According to the latest Central Bank of Kenya (CBK) report, the leading and affordable lender amongst top-tier banks is Co-operative Bank. Co-op charges an average of 15.18% for different loan products. Its maturities range from an overdraft to over five years.
Generally, banks in Kenya charge an average interest rate of between 9% and 20.96% for loans before factoring in borrowers’ credit profiles.
Cheapest Lenders
Premier Bank Kenya is the least costly lender at 9%, way below the CBK’s base lending rate of 12.75%.
EcoBank is second and charges 11.06%, making it an ideal lender for many borrowers in Kenya.
Co-operative Bank is charging the third lowest interest rate on long-term loans for corporate clients at 11.3%.
Access Bank (Nigerian), which plans to acquire the National Bank of Kenya, is among the cheapest lenders in the country, charging an average interest rate of 11.37%.
Diamond Trust Bank (DTB), Consolidated Bank, and Kingdom Bank, a subsidiary of Co-operative Bank Group, make up the top five least expensive banks in the country. They charge an average of 12.4%, 13.3% and 14.02% respectively.
Top Lenders
KCB and Equity Bank have emerged as the top lenders in terms of asset value. They have a high interest rate average of 16.4 and 16.2% respectively for various loan products.
Access Bank, DTB, and Equity Bank offer the lowest rates in the country at 11.3%, 12.03%, and 12.2% respectively.
Middle East Bank and HFC are the most expensive in that category at 24.3% and 21.94% respectively.
Most Expensive Lenders
Standard, Stanbic, and I&M are charging 17.3%, 17.5%, and 18.48%, making them very expensive to borrow from.
NCBA and Absa charge 19.91% and 19.12% respectively making them among the least affordable lenders in the country.
Credit Bank charges 23.2% while Middle East Bank charges 21.4%, making them among the most expensive in the personal short-term loans category.
Central Bank Economy Mitigation
The country’s economy has shrunk in the past few years following high bank rates. This made CBK go on a base rate hiking spree to cushion inflation which hit a high of 9.6% in October last year.
CBK has hiked the rate six times in a row to reach a high of 13%, the highest in 12 years, in February.
Early this month, CBK’s Monetary Policy Committee (MPC) cut its base rate to 12.75%.
Banks in the country are charging an average of 9 % to 20.96% interest rates for loans before factoring in borrowers’ credit profiles.
