2014-07-09

Banking Circular No 4 of 2014 - Operationalization of Kenya Banks\' Reference Rate (KBRR)

In January 2014, the Kenyan government introduced the Kenya Banks' Reference Rate (KBRR) to increase and enhance credit supply in the country. Initially set at 9.13 percent following a 8.50 percent Central Bank of Kenya rate, it is used as the base rate for flexible-rate loans offered by commercial banks and mortgage finance companies. All institutions are required to vary their lending rates close to KBRR and disclose any deviation from it to enhance transparency in credit pricing. This framework will apply to all new variable credit facilities while existing ones must transition by June 30th, 2015.

Kenya

Central Bank of Kenya

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