CBK Governor Dr. Njoroge Photo/the-star.co.ke
The Central Bank of Kenya in partnership with Kenya Bankers Association has developed a website that will enable borrowers’ compare hidden loan charges, reports the Star.
The site is set to go live soon. The website will ensure customers access much information for loan products before settling for any.
“We need to arm the customers much more by affording them a way of a window when shopping for loans through the website,” CBK Governor Patrick Njoroge said.
The cost of credit website will serve as a benchmark for bank customers to compare total cost associated with a loan and its repayment schedule.
The website will also disclose lenders’ annual percentage rate, which takes into account the interest rate component, bank charges and fees, third party costs including legal fees, insurance costs, valuation fees, and government levies.
Njoroge further noted that lending to micro, small and medium enterprises was down 5.7 per cent in the period, even though small banks have increased lending to this sector.
He shifted blame to large banks.
“If you want to know who has reduced lending to this sector ...it is the large banks. This is a concern because this is really where job creation and potential growth for output takes place,” said Dr Njoroge.