CBK signals on-site inspection of banks' credit pricing model from March 2027
The Central Bank of Kenya (CBK) plans to conduct on-site inspections of bank credit pricing models starting in March 2027. This initiative aims to ensure transparency and fairness in risk-based lending to SMEs following the implementation of the KESONIA framework.
Why it matters
Regulatory oversight of credit pricing is critical for maintaining financial stability and supporting small business growth in Kenya.
Kenya’s banking sector is expected to disburse more than Ksh.400 billion to Small and Medium-sized Enterprises (SMEs) by the end of 2026, even as lenders continue to grapple with elevated non-performing loans and the impact of the new risk-based credit pricing framework.
According to the Kenya Bankers Association (KBA), the push to increase lending to SMEs comes as the cost of credit continues to ease following a monetary policy easing cycle by the Central Bank of Kenya (CBK).
The latest data from the CBK shows that credit to the private sector remained strong at 10.2 per cent in July 2026, a slight slowdown from the 10.6 per cent recorded in June 2026, but a complete reversal of credit growth from the -2.9 per cent recorded in January 2025.
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