Central Bank Of Kenya Lowers Benchmark Rate To 8.75% To Accelerate Private Sector Credit Growth

Central Bank of Kenya reduces lending rate to 8.75%. Explore the 2026 list of interest rates for 38 banks, from Citibank's 10.21% to Access Bank's 19.05%.

By: AXL Media

Published: Apr 7, 2026, 9:48 AM EDT

Source: Information for this report was sourced from TUKO.co.ke

Monetary Policy Shift To Support Economic Expansion

The Central Bank of Kenya’s Monetary Policy Committee has implemented a strategic reduction of the Central Bank Rate, lowering it from 9.00% to 8.75%. This decision follows a series of easing measures intended to stimulate credit flow to the private sector while maintaining a stable exchange rate and keeping inflation within the target range. The committee noted that while global growth remains resilient at 3.3%, local interventions are necessary to ensure that domestic businesses and households can access more affordable financing to drive economic activity.

Divergent Trends In Commercial Lending Rates

Despite the downward adjustment of the central benchmark, the impact on commercial lending has shown considerable variation across the 38 banks operating in the country. Data from February 2026 indicates that the overall average lending rate for commercial banks stood at 14.78%, a decline from the 15.08% recorded in September 2025. However, structural challenges within the financial system have resulted in a slow transmission of these benefits to the public, with deposit interest rates averaging a modest 7.00% during the same period.

International Lenders Lead In Competitive Pricing

Citibank N.A. Kenya emerged as the market leader for affordable credit, recording the lowest lending rate at 10.21% as of February 2026. Other international and established institutions, including Standard Chartered Bank and Stanbic Bank, also offered rates significantly below the market average, hovering around the 12% mark. These sub-13% figures remain relatively rare in the Kenyan market, where larger domestic lenders like KCB and Equity Bank maintain rates closer to the 15% threshold, reflecting different risk appetites and operational structures.