Regulator Asks Banks To Extend Loan Repayment Period Over Coronavirus

Ksh 1000 notes

As the government of Kenya is putting measures in place to fight Coronavirus, the Central Bank of Kenya (CBK) after a joint meeting with commercial banks has announced a set of measures that the banks will undertake in order to alleviate the adverse economic effects their customers may face from the Coronavirus pandemic (COVID-19).

On Friday, President Uhuru encouraged Kenyans to explore cashless transactions to avoid the spread of the virus through cash. After talks with the Central Bank, the telco giant Safaricom agreed to waive the charges for all transactions below Ksh1,000. To further cushion Wanjiku from being wiped off by the adverse effects of this deadly virus for as long as it lasts, a number of decisions have been made to ensure they are able to continue with life normally without any much hustles. In a detailed press release, the CentralĀ  Bank of Kenya has announced a number of emergency measures that will apply for borrowers whose loan repayments were up to date as of March 2, 2020.

Banks have been asked to provide relief to borrowers on their personal loans based on their individual circumstances arising from the pandemic. In so doing these formal lenders will have to review requests from borrowers for extension of their loan for a period of up to one year. Borrowers have been asked to contact their respective Banks to facilitate this process. Medium-sized enterprises (SMEs) and corporate borrowers can contact their banks for assessment and restructuring of their loans based on their respective circumstances arising from the pandemic.

All the costs incurred or related to the extension and restructuring of these loans will be borne by the Bank. The regulator also noted that to facilitate the increased use of mobile digital platforms, banks will waive all charges for balance inquiry, and as earlier announced, all charges for transfers between mobile money wallets and bank accounts will be eliminated.