The Central Bank of Kenya (CBK) Governor, Kamau Thugge, has issued a warning that borrowers with poor credit histories will face higher interest rates under the newly revised risk-based credit pricing model. Speaking on September 2, Thugge clarified that the new model aims to streamline the banking sector and improve competitiveness, not to exclude borrowers.

• Borrowers with a higher risk profile will incur higher interest rates, as the new model allows banks to assess individual borrowing risk.
• The CBK stated that all new variable rate loans are subject to the revised risk-based credit pricing model from September 1, with existing variable-rate loans transitioning by February 28 next year.
• This change is part of ongoing efforts to strengthen monetary policy transmission and promote responsible lending by aligning credit pricing with borrowers' risk profiles, enhancing transparency in lending.