President Ruto has challenged Kenya’s banking sector to translate the country’s hard-won financial stability into more affordable and accessible credit for Kenyans, enabling households and businesses to benefit from the progress made in the economy over the past few years.
Despite the improving economic environment, the President noted, affordable credit remains out of reach for many Kenyans, constraining investment, entrepreneurship and job creation.
“Kenya does not need strong banks merely for the sake of having strong banks. We need strong banks capable of financing a strong economy,” he said during the 60th anniversary celebrations of the Central Bank of Kenya (CBK) at the Institute of Monetary Studies in Nairobi on Thursday evening.
He urged banks and other financial institutions to lower the cost of credit and expand access to financing, particularly for small businesses and ordinary Kenyans so that financial stability can translate into greater economic opportunity, stronger enterprise and improved livelihoods.
“Our financial institutions must become better at converting Kenyan savings into Kenyan production, including financing farms and factories, businesses and infrastructure, technology, exports, and enterprises,” he said.
The President said though lending rates have declined, sitting at 14.39 per cent in July, they remain prohibitively high for many Kenyans and businesses.
Present were CBK Board Chairman Andrew Musangi, CBK Governor Kamau Thugge, Association of African Central Banks Chairman Yvon Sara Bangui, members of the diplomatic corps and Principal Secretaries, among others.
President Ruto recalled he took office in September 2022 amid soaring inflation compounded by high food and energy prices, rising exchange rates, and major external debt maturity, which threatened to bring the economy to its knees.
He commended the CBK for its role in stabilising the economy over the past four years, particularly during a period when the country faced dire financial and economic pressures.
“The Central Bank tightened monetary policy as inflation and exchange rate pressures intensified. Government confronted external financial challenge, including the 2024 Eurobond maturity, while pursuing fiscal and structural measures to strengthen the economy,” he said.
The President said the manner in which the CBK restored stability to the financial sector underscores the importance of strong and independent institutions, particularly during times of economic uncertainty and financial volatility.
“Strong institutions matter most when circumstances are difficult. The independence of the Central Bank is therefore not an abstract constitutional principle. It is Kenya’s economic strength,” he said.
At the same time, President Ruto called for greater financial integration across the African continent to unlock the resources needed to finance development.
He said Africa should leverage on the $4 trillion it holds in financial assets across banks, pension funds, insurance funds, and capital markets to finance development projects.
“Our ambition is not to retreat from the global economy, but to engage it from a position of greater financial strength while mobilising more of our own capital for our own development,” he said.
