Tuesday, 22 March 2016

Beware of those well-concealed charges as you choose a bank.Drive Hot News

If you regularly pay the correct amount, you will never have any outstanding interest. Most of the people who complain about too much interest on a bank loan will usually have missed some payments, or even under paid in some months. PHOTO | FILE

As banks declare super normal profits for a year that saw the whole economy struggle, consumers are becoming more aware that this performance may be driven by hidden charges and high interest rates.
And with an average middle aged Kenyan operating more than one bank account, a Savings and Credit Co-operative (Sacco) account and a mobile money account, mobility has become much easier.
The 2016 household survey conducted by Financial Sector Deepening (FSD) estimates that with 18 per cent of the population using new mobile banking services such as M-Shwari and KCB M-Pesa, the proportion of bank account users has now risen to 38 per cent,   a 10 per cent  increase since 2013.
For a long time, banks have been fleecing borrowers with little or no information on how expensive the money they are borrowing is.
Central Bank Governor Patrick Njoroge has been urging Kenyans not to feel “trapped” by their banking institutions and should use the information provided by the regulator to make wise choices when selecting bank products.
“Our view is still the same, commercial banks need to lower their rates in a proportionate way. This is where people need to vote with their feet, I mean why do you feel trapped? If you think it is a high rate why not move to another bank, vote with your wallet,” he said during a press conference at the end of last year.
The CBK boss added that customers should also exit banks that offer poor services instead of complaining all the time.