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{
    "id": 959782,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/959782/?format=api",
    "text_counter": 186,
    "type": "speech",
    "speaker_name": "Alego-Usonga, ODM",
    "speaker_title": "Hon. Samuel Atandi",
    "speaker": {
        "id": 13290,
        "legal_name": "Samuel Onunga Atandi",
        "slug": "samuel-onunga-atandi"
    },
    "content": "have six large banks in Kenya. That would mean that we need to look at the capital requirements for starting a bank. The other issue which we need to apprise ourselves on is that there are fundamentals that influence banking activities like the widening fiscal deficits. Every year we pass a budget in Parliament whose funding we are not even sure of. We pass a budget and the deficit is very big and then we expect the Government not to borrow money from banks. One of the things that we must do, especially in the coming financial year, is to ensure that we pass a budget which has a very small fiscal deficit. We will then be able to say that the Government should not borrow from banks. Otherwise, if we sit here and condemn the Government for borrowing from banks then we are not being honest with ourselves. Let us bridge that fiscal deficit then the Government will have no option but not to borrow from the banks. That is the reason why I am happy that currently, the Executive is doing what is called budget rationalisation. They are asking ministries to see what they can cut. This is something that we support and it needs to be done. The budget needs to be cut by 50 per cent. If that happens, we will head somewhere. When banks speak against this law, they use what is called small and medium enterprises (SME) credit as a smokescreen to cheat Parliament and Kenyans that there are SMEs which need credit and that this law is holding them back. As a professional in the banking sector, even if we remove this law, there is no way that banks will give credit to SMEs. We will not be able to force them. They would still continue to give credit to people they consider credit-worthy and sectors that will give them more profit. They can still refuse to give them credit. The argument against the interest cap law cannot sell. It does not carry weight. I urge the House that when we finally present the Finance Bill in this House which has a ridiculous proposal to repeal the law itself in its entirety, let us reject it. Let this House stand with Kenyans in ensuring that the cost of credit does not go up. Currently, even at 14 per cent, businesses across the country are unable to pay their loans. Today, the Credit Reference Bureau (CRB) continues to list all businesses. They are doing that because the cost of credit is still very high. Nobody should cheat this House that the interest cap regime which we are currently discussing is hampering businesses. It is trying to help businesses to a small extent. If you want to compare the credit regime in Kenya vi-a-vis other countries like South Africa, loans cannot be prized at even 10 per cent. We need to do much more to lower the cost of credit but that will mean that this Parliament must take decisive action in ensuring that our budgets do not have a wider budget deficit. I support the Bill."
}