Nairobi 25, August 2016: The banking industry, through the Kenya Bankers Association (KBA), welcomes the spirit of yesterday’s decision by His Excellency President Uhuru Kenyatta to assent to the Banking (Amendment) Bill 2015. We believe that the essence of the decision is aligned to the Kenya banking sector’s continued commitment to address the fundamental issues that drive up the cost of credit.
Our reservations on some of the particulars of the Act notwithstanding, we reiterate that we will comply with the Act once it has been operationalised. Towards this end, KBA will engage with the Central Bank of Kenya on how the industry will best apply the law. In the interim, the existing loan and deposit account terms will continue to apply. We have maintained since debate on this issue commenced, the banking sector remains committed to address the drivers of costs and inefficiencies in banking. It is in this regard that the sector presented a 7-point Memorandum of Understanding (MoU) to the Central Bank as a testament of our commitment to address the issues in a sustainable way. Among the pledges we made in the MoU was to support Micro, Small and Medium Sized Enterprises through the Inuka Enterprise SME Development Program – A program that will see banks commit Ksh 30 billion worth of capital extended to MSMEs at preferential rates. Of this, Ksh 10 billion will be allocated to women and youth-owned businesses. KBA will continue to work with the banks to roll out this program and the other elements of the MOU in line with the Banking Act. Ends…
