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{
    "id": 632532,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/632532/?format=api",
    "text_counter": 239,
    "type": "speech",
    "speaker_name": "Hon. Ogalo",
    "speaker_title": "",
    "speaker": {
        "id": 2679,
        "legal_name": "George Oner Ogalo",
        "slug": "george-oner-ogalo"
    },
    "content": "and are in a hurry to raise the interest rates they charge on loans, then we have an economy being sabotaged. I hear bankers argue that the reason we have high interest rates in Kenya and not in developed countries is that the rate of default or the risk in loaning money in Kenya is higher. I wonder whether it is high interest rates which cause default or the culture of Kenyans to default. Who would fail to pay a loan at an interest rate of 3 per cent? I heard the Hon. Commissioner indicating here that in Japan, there is negative interest rate. What stops a Kenyan bank from going to borrow that negative interest rate loan to come and lend Kenyans at five per cent? If you want to support the economy, banks should go out of their way to facilitate trade and commerce by offering cheap loans to spur growth. The biggest impediment of business and entrepreneurship in Kenya is the high interest rate and the high tax that we pay. Which business will make more than 30 per cent return on investment? You borrow money to trade, make 30 per cent and the bank claims 24 per cent. What is the business of being in that business? Are you in the business of making money for the bank or you are in the business of growing your own portfolio? Hon. Jude Njomo should even go further. I would advise that we tighten the decision- making on the base lending rate because we can be sabotaged again after passing this Bill. The CBK can decide to sabotage lawmakers by putting a base lending rate that still makes interest rates be out of reach of Kenyans. In supporting this Bill, we should go further. In fact, Jude Njomo, as the Mover, could even bring further amendment to tighten the decision-making around it. The CBK should set the base lending rate that is commensurate to the economy. You cannot tell me that when the Government borrows money through bonds at 21 per cent, banks are at 29 per cent. When they come back to 9 per cent, the banks refuse to come down with them and stay at 18 per cent. Why? The banks are in the business of crippling Kenyan businesses. I support this Bill now and when it comes for the Third Reading."
}