British Banking Multinational Stanchart has reported that it is making a loss of Sh 5million of profits per month from the waiver of bank to M-Pesa transaction fees. The waiver had been introduced as part of measures to cushion customers from the financial effects of COVID-19.
The Central Bank had introduced the elimination of charges and they were to take effect from March 16 2020 through to June 30, 2020.
The waiver was later extended to December 31, 2020 leading to protests from both leading telco Safaricom and banks.
Chief Executive of Stanchart Kariuki Ngari revealed the loss from the waivers during the lenders annual general online meet up at the end of last week.
Additionally he said the bank had also restructured loans to a tune of 17.5 percent of its total loan book, cushioning borrowers whose incomes have reduced as a result of the COVID-19 virus.
“To date, we have restructured loan facilities worth more than Sh22 billion over varying extension periods to a maximum period of 12 months as well as providing deferred payment terms,” Mr Ngari said.
“These restructured loans are supporting the SMEs in diverse fields of agriculture, manufacturing, trade, transport and communication, building and construction, tourism and hospitality industries in the country.”
Customers found it hard to repay their loans as a result of the virus and the control measures undertaken to control its spread.
The CBK had also arranged for the restructuring of loans after it became apparent that many customers both private and corporate would have a challenge to settle their financial debts.