Nairobi, Kenya – Starting September 2025, Kenya will introduce a new transparent credit pricing framework aimed at revolutionizing the lending sector. The framework is designed to increase clarity and fairness in loan pricing by linking it to the borrower’s individual risk profile. This move intends to promote responsible credit practices among financial institutions and provide borrowers with better understanding of loan costs.
The initiative comes as part of Kenya’s efforts to foster financial inclusion and support sustainable economic growth. It will require banks and lenders to clearly disclose how interest rates and fees are determined, enhancing transparency for customers.
The Central Bank of Kenya and other regulatory bodies have been working closely with financial institutions to prepare for the rollout. Stakeholders believe that this framework will:
- Empower consumers
- Reduce hidden charges
- Encourage competition among lenders
Kenya’s credit market has grown rapidly, but challenges such as unclear pricing and high costs have limited access for many. By implementing this new framework, Kenya positions itself as a leader in responsible lending practices in Africa.
The new credit pricing model is expected to benefit both consumers and lenders by:
- Improving trust
- Making credit products more tailored to individual circumstances
It aligns with Kenya’s digital economy growth and enhanced financial services regulation.
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