CBK data: Cooperative Bank beats peers in offering cheap loans

If you are seeking a personal or business loan, Co-operative Bank of Kenya should be your top priority based on the latest Central Bank of Kenya (CBK) data.

The monthly lending rates ranking for the 38 commercial banks in Kenya by the CBK for August 2024, indicates that Co-operative Bank of Kenya charged the most competitive interest rate of 12.02% for personal loans customers who sought an overdraft. This is the cheapest rate a customer can get from any of the nine tier-one banks.

Interest rate on overdrafts for personal loans for top-tier banks in Kenya;

1. Co-operative Bank – 12.02%
2. Diamond Trust Bank – 12.07%
3. Equity Bank – 12.71%
4. Standard Chartered Bank – 13.33%
5. Absa – 14.69%
6. Stanbic Bank – 16.74%
7. KCB – 17.37%
8. I&M – 17.65%
9. NCBA – 18.34%

The data further indicates that Co-operative Bank of Kenya offers the cheapest loans for businesses seeking overdrafts.

The banks ranking by CBK for an overdraft in the business category:

1. Co-operative Bank – 12.28%
2. Diamond Trust Bank – 12.38%
3. Equity Bank – 13.94%
4. Standard Chartered Bank – 16.71%
5. Stanbic Bank – 16.84%
6. I&M – 17.29%
7. NCBA – 17.55%
8. KCB – 17.65%
9. Absa – 22.47%

Overall the CBK says commercial banks charged between 9% and 21.36% as interest on the personal, business or corporate loan categories of loans advanced to customers in August 2024. The interest rates varied depending on repayment duration.

The CBK data indicates that Premier Bank Kenya offered the cheapest loans in August 2024 at an average of 9% while Middle East Bank charged the highest interest rates on loans at a mean of 21.36%.

In the top-tier banks category, Diamond Trust Bank and Co-operative Bank of Kenya had the cheapest loans priced at 12.41% and 15.14%, respectively.

Ranking of overall average interest rate charged by top-tier banks in August 2024:

1. Diamond Trust Bank – 12.41%
2. Co-operative Bank – 15.14%
3. Equity Bank – 16.12%
4. KCB – 16.38%
5. Stanbic Bank – 17.39%
6. Standard Chartered Bank – 17.81%
7. I&M – 18.53%
8. NCBA – 18.73%
9. Absa – 19.92%

The CBK has over the last two months been publishing the lending rates for commercial banks to enable borrowers to make informed decisions when seeking loans from any of the 38 banks in Kenya.