KCB Bank Kenya has announced a reduction of its base lending rate to 9.0%, directly aligning with the Central Bank of Kenya’s recent cut of the Central Bank Rate (CBR) to 9.0%.

The adjustment comes under the new Risk-Based Credit Pricing Model (RBCPM), adopted from December 1, 2025, aimed at ensuring that lending reflects both market conditions and customer risk profiles.

“Following the latest adjustment of the Central Bank Rate (CBR) by the Central Bank of Kenya (CBK) to 9.0% and in line with the new Risk-Based Credit Pricing Model (RBCPM) adopted from December 1, 2025,”

“KCB Bank Kenya wishes to notify our customers and the public that new loan currency-denominated variable-rate loans taken from December 11, 2025,will be priced on a base rate of 9.0%,” read the KCB’s X post dated December 11, 2025, in part.

The banks noted that the final lending rate is based on a customer-specific margin, adjusted to the base rate, in line with the pricing model, adding that all facilities applied for from December 1, 2025, will be adjusted accordingly upon the expiry of the 30-day notice period as required by CBK.

KCB clarified that all existing local currency variable-rate loans taken before December 1, 2025, will remain under their current terms until the end of the Central Bank-mandated transition period on February 28, 2026.

The bank emphasised that all applicable fees, charges, and the total cost of credit will be fully disclosed to borrowers, ensuring transparency and compliance with Central Bank of Kenya requirements.

“All existing local currency variable-rate loans taken before December 1, 2025, will continue under the current terms and will transition to the new framework by the end of the CBK-mandated transition period (February 28, 2026). All applicable fees, charges, and the total cost of credit will be fully disclosed to customers in line with the CBK requirements,” the notice stated.

Implementation for new and existing loans

The revised base rate takes immediate effect for all new local currency variable-rate loans from December 11, 2025. Customers with facilities applied for before December 1 will retain their current terms until the end of the mandatory transition period on February 28, 2026, after which the loans will automatically move to the new RBCPM framework.

KCB emphasised that the adjustment is designed to ensure transparency and fairness in lending while reflecting individual customer risk profiles.