Kenyans to enjoy cheaper loans following a reduction in lending rates by the National Commercial Bank of Africa (NCBA).
In a notice issued on April 21, 2025, the National Commercial Bank of Africa (NCBA) announced that its lending rate has been reduced from 17.50% to 14.34%.
“In view of the recent Kenya Central Bank Rate (CBR) downward revision and our mission to make customers’ lives easier, we wish to inform you that NCBA Bank’s Kenya Shillings Base Lending Rate (NBLR) will reduce by 1% from 15.34% p.a. to 14.34% p.a. Since August 2024, NBLR has dropped by 3.20%. Over the same period, CBR has dropped by 3.00%,” the statement read.
Further, they stated that the new lending rate will start to be effective as of May 1, 2025.
NCBA Changes in Loan Rates
According to NCBA, the reduction in lending rates will not affect fixed-rate loan facilities, which will continue under their existing terms.
Additionally, the interest rates on variable-rate loan facilities tied to the NBLR will be revised accordingly, with changes taking effect from May 1, 2025.
Further, the revised Base Lending Rate will apply immediately to all new loan facilities.
NCBA stated that all other terms and conditions of customer loan facilities shall remain unchanged.
Also Read: National Bank Reduces Interest Rates for New and Existing Loans
CBK Reduces CBR
This follows the Central Bank of Kenya’s (CBK) move to lower the Central Bank Rate (CBR) after a Monetary Policy Committee (MPC) meeting on April 8, 2025.
In a statement after the meeting, CBK Governor Dr. Kamau Thugge said MPC lowered the CBR by 75 basis points to 10.00 percent from 10.75 percent, the lowest the benchmark has been since May 2023.
“The Committee concluded that there was scope for a further casing of the monetary policy stance to stimulate lending by banks to the private sector and support economic activity while ensuring exchange rate stability,” reads part of the statement.
Also Read: KCB Reduces Interest Rates on New and Existing Loans
CBK Cuts Bank Rates
CBK announced that the committee had reduced the CBR by 75 basis points to 10.00 percent from 10.75 percent the lowest the benchmark rate has been since May 2023.
According to CBK, central banks in the major economies have continued to lower their interest rates, but at different paces depending on inflation and growth expectations.
CBK stated that this reflects the dissipation of exchange rate valuation effects on foreign currency denominated loans following the appreciation of the Shilling, and improved demand with declining lending interest rates.
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