This archive report was first published on 10 September 2019.
On September 10, 2019, the Finance and National Planning Committee of the National Assembly expressed strong opposition to the National Treasury's proposal to amend section 33 (b) of the Banking Act.
The proposed amendment, contained in the Finance Bill 2019, aims to remove the capping of interest rates, a move that has been met with resistance from the parliamentary committee members.
According to the committee members, removing the interest rate cap will subject Kenyans to expensive credit at the expense of commercial banks.
Acting National Treasury Cabinet Secretary Ukur Yatani met with his Principal Secretary Dr. Julius Muia and officers from the Kenya Revenue Authority (KRA) to consider the bill, but the committee members remained unconvinced.
Ukur Yatani argued that the interest rate capping affects the Small and Medium Enterprises (SMEs) lending, and that the controls have had serious effects on the credit to the SME sector.
However, the committee members were not swayed by Yatani's arguments, and the proposal remains strongly opposed.
