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BOZ Says Lending Interest Rates Will Not Exceed 18.25%

The Bank of Zambia has announced that maximum effective annual lending interest rate that commercial banks can charge any borrower will not exceed 18.25%.

This decisive action is aimed at stopping banks from charging excessive interest rates.

Central Bank Head of Public Relations Kanguya Mayondi says this cap is arrived at by adding a factor of 9 percent to the Policy Rate which currently stands at 9.25 percent.

In a statement released to Qfm news, Mr. Mayondi says the Bank of Zambia will periodically revise the factor applicable on the Policy Rate in response to changes in economic fundamentals and the Policy Rate itself.

He says the measure takes effect from the 2nd January, 2013 when the conditions will apply on new loans written.

Mr. Mayondi however states that existing loans will be allowed to run their course on the current terms unless refinanced.

He further states that a similar measure for providers of credit other than commercial banks will be announced in due course.

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Posted by on December 22, 2012. Filed under BUSINESS. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

7 Responses to BOZ Says Lending Interest Rates Will Not Exceed 18.25%

  1. PSYCHOLOGIST

    December 22, 2012 at 2:38 pm

    reduce it further 18.25% not good enough.

  2. Democrat

    December 22, 2012 at 2:45 pm

    Still 18.9% is too much. Pipo in western countries are rich bcoz of good loan offered by banks thru govt’s fiscal decisions on maximum interest rates. Zambian banks will still fuz in some hidden costs and it will go beyond 18.9%.

  3. Democrat

    December 22, 2012 at 2:50 pm

    Slip of the thumb, (18.25% and not 18.9%)

  4. Ba game

    December 22, 2012 at 3:23 pm

    increase it further at 81.9% that will be good enough.

  5. Morious

    December 22, 2012 at 3:30 pm

    This rate is only attractive to those who earn more..

  6. Big Chilolo

    December 22, 2012 at 7:31 pm

    Why not 11% for instance. And when will the government introduce proper car dealerships like it happens in RSA?
    The banks finance such loans by paying off the car dealer and then an individual owes the bank.
    Also the issue of TOLL GATES must be implemented as soon as posbo and revenue strictly used 4 road project and not 4 political campaigns. If the president doesn’t have technocrats to deal with this issue,let him appoint me to lead RDA and I’ll bring sanity to this God forsaken agency!

  7. masauso

    December 25, 2012 at 2:52 pm

    they have always been around 18%. what happened to the 9% policy rates has is failed BOZ has also started hallucinating