Access Bank Kenya Reduces Base Lending Rate by 1%

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Access Bank Kenya has announced a 1% cut to its base lending rate, a move that will take effect from April 14, 2025. The reduction applies to all loans issued in Kenyan Shillings and is expected to ease borrowing costs for individuals and businesses alike.

The bank’s decision comes in response to recent changes in the monetary policy landscape, following the Central Bank of Kenya’s (CBK) push to make credit more affordable.

In February, the CBK lowered its benchmark Central Bank Rate (CBR) by 50 basis points to 10.75%, and also slashed the Cash Reserve Ratio (CRR) from 4.25% to 3.25%.

Read: CBK Cuts Lending Rate for Fourth Consecutive Time

These changes are intended to boost liquidity in the market and encourage lending, particularly to micro, small, and medium-sized enterprises (MSMEs), which form the backbone of Kenya’s economy.

According to Access Bank, the rate adjustment aligns with ongoing efforts to support customers during a period of economic recovery. By lowering its base lending rate, the bank hopes to encourage more borrowing, spur business activity, and offer relief to households and enterprises grappling with high credit costs.

The move also follows increased pressure from the CBK, which has been cracking down on banks that fail to reflect the lower CBR in their lending rates. The regulator recently introduced strict penalties, including daily fines of up to Sh 100,000 per loan account in violation and up to Sh 20 million in total, or three times the financial gain made from non-compliance.

Read: Bank Lending Rates in Kenya 2025

To enforce these directives, the CBK has begun on-site inspections and is closely monitoring banks through the Risk-Based Credit Pricing Model. These steps are part of the reforms under the amended Banking Act aimed at protecting borrowers from overpriced loans.

Just last week, a report revealed that 14 commercial banks had yet to comply with the CBK’s directive to lower lending rates. This resistance has drawn criticism from CBK Governor Kamau Thugge, who has consistently urged banks to pass on the benefits of rate cuts to consumers and help stimulate the economy.

Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.