Nairobi, Kenya| Equity Bank Kenya has announced a reduction in interest rates for all new and existing Kenya Shilling-denominated credit facilities.
This follows the recent decision by the Central Bank of Kenya’s (CBK) Monetary Policy Committee (MPC) to lower key benchmark rates.
The rate adjustment will take effect immediately for new loans issued from February 13, 2025, while existing loans will benefit from the lower rates starting March 1, 2025.
The move follows the MPC’s decision on February 5, 2025, to cut the Central Bank Rate (CBR) by 50 basis points, from 11.25% to 10.75%, and reduce the Cash Reserve Ratio (CRR) by 100 basis points, from 4.25% to 3.25%.
These policy measures were aimed at increasing liquidity in the banking sector, lowering the cost of credit, and stimulating economic activity by boosting private-sector lending.
Equity Bank’s Commitment to Affordable Credit
With this reduction, Equity Bank has revised its Equity Bank Reference Rate (EBRR) to 14.39%, plus a margin determined by individual customer risk profiles.
The new rates reflect a 300-basis point (3%) reduction across a broad range of credit products, demonstrating the bank’s commitment to supporting both businesses and individuals through more affordable financing.
Equity Bank Kenya’s Managing Director, Moses Nyabanda, emphasized the institution’s dedication to easing financial pressures for customers:
“We understand the financial pressures facing Kenyans today, and we’re committed to doing our part to ease that burden. This rate cut is about more than just lower interest rates; it’s about opening doors for Kenyans to invest in their businesses, support their families, and sustain their livelihoods.”
This marks the third time in six months that Equity Bank has reduced its lending rates, having previously lowered them in September and November 2024.
The consistent rate adjustments underscore the bank’s proactive approach to supporting customers amid evolving economic conditions.
Impact on Businesses and Households
The reduction in lending rates is expected to have significant economic benefits:
- For Businesses: Lower borrowing costs will enable companies to access more affordable credit, reducing operational expenses, increasing investment capacity, and fostering job creation.
- For Households: Reduced interest rates mean lower monthly loan repayments, which increases disposable income, boosts consumer spending, and enhances financial well-being.
The MPC’s decision to lower the CRR was particularly aimed at freeing up additional liquidity in the banking sector, ensuring that financial institutions have more capital available for lending.
Equity Bank’s adjustment aligns with these policy goals by directly passing on the benefits to its customers.
A Long-Term Commitment to Financial Inclusion
As Kenya’s economic landscape continues to evolve, Equity Bank remains committed to advancing financial inclusion and economic development.
By making credit more accessible and affordable, the bank aims to empower individuals, entrepreneurs, and businesses to expand, create employment opportunities, and contribute to overall economic growth.
The bank’s proactive response to monetary policy changes underscores its role as a key player in driving sustainable financial solutions that benefit the broader economy.
Equity Bank continues to monitor market conditions and remains committed to supporting customers in navigating an ever-changing financial environment.
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