Kenyans set to pay more for loans as CBK raises base lending rate to 12.5%

Borrowers in the country have been dealt a major blow after the Central Bank of Kenya (CBK) hiked the benchmark lending rate to 12.5%.

The increase represents a change of 2 percentage points from 10.5%.

CBK blames exchange rate depreciation which it said was exerting upward pressure on domestic prices and the rising of public sector external debt service.

The upward revision now complicates efforts to have cheaper and affordable credit as households continue to struggle with the high cost of living.