The director of Kenya Bankers Association Jared Osoro, today in a press conference said that the KBA will comply with the act and how best to tackle the changes in reaction to the Banking bill. The Banking Amendment Bill 2015 was assented to by President Uhuru Kenyatta.
This was done as a way to curb the high interest rates in Kenya’s banking sector and has seen the youth and the marginalised groups being locked out from accessing loans for their Micro Small and Medium Enterprises.
The Banking sector has also made a pledge in an MOU to the central bank of Kenya, of a programmer dubbed Inuka enterprise that will see banks commit Kshs. 30 billion worth of capital of this Kshs. 10 billion will be allocated to women and men, while Kshs. 20 billion will be allocated to the youth.
KBA did not shy away from expressing their reservation with some of the particulars of the Act even though they reiterated that they will comply with the Act once it has been operationalized. According to Jared Osoro,”Whichever way it comes out,we will have to comply,” he said.
Though the Act has been assented to, the period needed before it’s put into action is not yet clear as it will take an approximated period of seven days for it to be gazetted by the Attorney General and later a minimum period of three weeks for it to take its full course.
In the interim ,the existing loan and deposit terms will continue to apply. According to Mr. Jared Osoro,”The Act may have been assented to but the law has not removed the challenges that make the lending rates go up.” KBA insisted that banks will be forced to come up to with a new model to facilitate the changes.
The KBA insisted that there are no cartels within the sector and if any are found they will be subject to punitive action.
