mmegi

BoB gives banks free rein on lending rates

Making moves: Pelaelo says the liberalisation of the prime lending rate will be closely monitored
Making moves: Pelaelo says the liberalisation of the prime lending rate will be closely monitored

The Bank of Botswana (BoB) plans to give commercial banks the freedom to set their prime lending rate9s from April 1, the anchor instrument which influences lending rates across other credit products such as scheme and personal loans as well as mortgages.

The central bank argues that freeing up the prime lending rates will “facilitate market competition and fair pricing of credit and other lending products,” although the BoB will monitor implementation and “enforce good business conduct”.

Before a wave of reforms in the country’s interest regime dating back to last April, the prime lending rate, defined as the lending interest rate banks give their best customers, was pegged at one and a half percentage points above the bank rate.

Editor's Comment
The Boko-led administration has to tread carefully

‘When you make peace withyourself, you make peace with the world’- Maha GhosanandaThis may come at a huge cost if not handled properly. What started off on Labour Day in Letlhakane this year, where Boko was in attendance when the militant lawyer-cum-trade unionist, Robert Rabasimane rebutted the President’s address in defence of the trade union has seemingly spiralled out of control. The issue is now creating a cat-and-mouse type of a...

Have a Story? Send Us a tip
arrow up