In the wake of all financial difficult times in the country, it has emerged that groups have been befitting their own for survival, literally. A  recent survey by The Central Bank of Kenya (CBK) reveals that small banks have been lowering their lending rates for the three months in the beginning of 2012.

The Central Bank of Kenya (CBK) survey of all the 43 lenders showed small banks had reduced their lending rates to 19 % in March from an average 19.6% in January. The same cannot be said of the large banks who have been doing the exact opposite of what the small lenders have been doing. These banks have been charging 21.1 % up from 19.7 % over the same period. (Courtesy Business Daily)

Banks classified as large banks in Kenya are KCB, Equity, Barclays, Standard Chartered, Co-operative and CFC Stanbic bank. The banks base their lending rates on the Central Bank Rate (CBR) which the regulator has maintained at 18% to discourage credit taking and lower the rates of inflation.

Finance minister Njeru Githae has been urging lenders to lower their rates for their customers. The minister said the banks need to show appreciation for the customers contribution in the banks growth and reduction of non performing loans.

A proposal to have interest rates on loans capped at 22%, was thwarted by parliament last month giving banks a sigh of relief.