Kenyan banks root for CBK rate rise to arrest non-performing loans

Kenyan banks are facing a significant challenge with non-performing loans (NPLs), prompting the Kenya Bankers Association to advocate for further monetary policy tightening by the Central Bank of Kenya. The CEO of Miradi Capital, Abraham Muthogo Kamau, discussed the current state of NPLs in the market, the impact of tightening the repo rates on the private sector and consumers, and the implications of increasing Treasury bill rates on businesses. Kamau also highlighted the difficulties faced by start-ups and the need to reframe financing strategies to support young entrepreneurs. Additionally, he addressed the rising defaults in President William Ruto's Hassler fund and suggested that fixing the economy should be the primary focus to address the high default rates. Kamau recommended simplifying business operations for SMEs through legislative, operational, and compliance reforms, including the implementation of a single tax system for SMEs to enhance compliance and promote business growth. Overall, the discussion underscored the importance of creating a stable economic landscape to support the growth of small and micro-enterprises in Kenya.