Kenya Bankers association introduces online credit calculator
from ANTONY LANGAT in Nairobi, Kenya
NAIROBI – THE Kenya Bankers Association (KBA) has launched the Credit Calculator Online in a move it believes would enhance pricing transparency while stimulating competition within the banking industry.
Speaking during the launch, KBA Chairman, Joshua Oigara, said that it is anticipated that the Kenya Banks’ Reference Rate (KBRR) and KBRR and the Annual Percentage Rate (APR) initiative would enhance transparency.
“Promoting transparency in lending remains a priority for the financial services sector and for banks in particular, we therefore are thankful to our stakeholders, including the Central Bank of Kenya and the National Treasury, for their partnership in this quest to enhance access to credit through progressive and enabling policies,” said Oigara.
APR is made up of an interest rate component that is derived from KBRR plus individual banks’ administrative costs and product related fees, a risk premium and the banks’ profit margin as well as related third party costs.
Oigara noted that KBRR and APR are two of the interim and long-term interventions by the players to enhance credit access.
“Beyond interest rates, there are other costs that influence access to credit. And through the Cost of Credit Committee the Government, regulators and industry have identified priority initiatives to address these inefficiencies,” he said.
The Chief Executive Officer of KBA, Habil Olaka, said that the industry-led APR implementation was also a consumer protection intervention that highlights banks’ commitment to provide customers with facts that they needed to make informed credit decisions.
– CAJ News
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