Below is a summary of the winners and losers from the new Interest Rate Cap law according to a market report by Cytonn Investments:
| Summary of Winners and Losers from the Interest Rate Cap Bill | |
| THE WINNERS | THE LOSERS |
| · Banks that lend primarily to the prime individual and corporate commercial segments because they have the most clients that can fit within the 4.0% risk premium. For example, Standard Chartered Bank | · Banks that lend primarily to the SME and sub prime segment because majority of their clients can’t fit into the 4.0% risk premium. For example, Equity Group, KCB Group and Co-operative Bank |
| · Prime individual clients, because they will be highly sort after by the main stream banks since they will be seeking to bank prime clients, with assets to provide collateral | · Sub-prime clients because they will experience even most constrained access to conventional credit and will have to seek alternative & more expensive credit |
| · Corporate commercial segments because they will be highly sort after | · The SME sector since access to credit will be limited |
| · The government as banks will prefer to place money in Treasury instruments that are considered risk free | · The Kenyan economy, which is very reliant on SME sector. If there is less access to credit, the economy will register slow growth unless it adjusts very quickly by moving a lot of SME funding to the informal financing market |
| · Alternative finance and credit players that are outside the ambit of the amended Banking Act, 2015, since they can still price credit based on market dynamics | · Small depositors are likely to be pushed to no interest accounts |
| · Banks with multinational links as they can mobilize cheaper dollar funding from their parent company | · Government since banks will record low earnings, reducing their taxable income |