CBK Governor says won’t engage in ‘political expediencies’ over CRB as he dismisses Ruto’s CRB and banking promises.
President William Ruto’s proposal to revise the Credit Reference Bureau (CRB) framework remains in limbo as Patrick Njoroge, governor of the Central Bank of Kenya (CBK), reaffirmed the importance of adhering to the nation’s monetary policies.
Ruto’s banking promises may suffer rejection, with the Central Bank of Kenya (CBK) refusing to be drawn into taking actions aimed at satisfying political interests.
Speaking during an interview with an international media house, Bloomberg, CBK Governor explained that existing data from CBK will guide financial policies and expenditures for the next government.
He insisted that the data from CRB will help the country remain afloat and overcome recession waves ruling out being drawn into political expediencies.
“The Central Bank will continue with policies it has always had regardless of the new administration that has come in. Good central bankers do their work based on data as opposed to political expediencies. You will see the Central Bank continuing along the same lines as before,” Njoroge stated.
He, however, explained that CRB Monetary Policy Committee was scheduled to meet next week to evaluate the data and chart a way forward regarding the country’s economy.
“We as MPC members will look at the data before us, both domestic and external data, look at the various things including projections on inflation and it’s the data that will tell us what to do,” he added.
Instead of responding to political financial promises, Njoroge insisted on the need to service the debt and protect CBK reserves from recession pressure. The governor noted that debt management was key to remaining afloat.
“Debt management is something that needs to be taken much more seriously given the narrowing space that we have seen in recent months,” he stated.
“See what else we can do on refinancing whatever high-interest debt with low-interest debt, looking more towards concessional debt,” he added.
President Ruto promised Kenyans during his inauguration that he would review the law to increase the number of heavy cash transactions that banks could handle without being required to report from the current Sh1 million and that he would relax the Credit Reference Bureau Framework (CRB) to make credit more accessible to more Kenyans.
In the speech, Dr. Ruto mentioned how traders complained about the hardship associated with cash transactions over Sh1 million.
“We shall take measures to drive down the cost of credit. Our starting point is to shift the CRB framework from its current practice of arbitrary, punitive, and all-or-nothing blacklisting of borrowers, which denies borrowers credit. We will work with CRBs on a new system of credit score rating that provides borrowers with an opportunity to manage their creditworthiness. This will eliminate blacklisting,” Ruto committed after being sworn in.
“I have been assured by the Central Bank that works on how to ease this burden without compromising the security of the financial system is underway,” he said.