Kenya and Uganda central banks are pushing for lower lending rates from commercial lenders for consumers.On Wednesday, the Central Bank of Kenya (CBK) cut its benchmark rate by 3.5 percentage points to 13 per cent in response to falling inflation in the East Africa’s largest economy, but Prof Njuguna Ndung’u, CBK’s governor, noted that lower costs of doing business for banks has not yet filtered down to consumers. Unlike the first cut on the Central Bank Rate (CBR) in June where commercial lenders started announcing rate cuts on their base rates a day after CBK announced a cut from 18 per cent to 16.5 per cent, no lender had announced a rate cut as of the close of business on Friday. CBK said that it has provided avenues that reduce the cost of doing business for banks including allowing for; the integration with mobile phone financial services platforms, movement into the agency banking network and licensing of Credit Reference Bureaus, all of which have resulted in lower costs. "The Committee [Monetary Policy Committee] noted that interest rate spreads remained high suggesting that these cost reductions had yet to be fully transferred to bank customers and the economy at large through declining cost of credit,” said Prof Ndung’u in the statement released on Wednesday. On Tuesday, Prof Emmanuel Tumusiime-Mutebile, governor, Bank of Uganda was more direct in his statement when he announced a cut of two percentage points in the CBR which now stands at 15 per cent in East Africa’s third largest economy. He said that despite a six percentage points cut in benchmark rate this year, commercial banks have not given the same benefit to consumers in Uganda. "I expect commercial banks to respond more positively and reduce their lending rates to stimulate demand for credit,” said Prof Tumusiime-Mutebile in his statement.He said that the new cut, which was also in response to falling inflation, would lower the cost of funding for commercial banks and this was expected to trickle down to consumers who will borrow at lower rates.The cost of living fell to 11.9 per cent in August in Uganda and to 6.09 per cent in Kenya. Uganda is Kenya’s largest trading partner in terms of exports in the East African region and Kenya’s second largest trading partner in terms of imports after Tanzania according to the Economic Survey of 2012. As at the end of last year, seven commercial banks with operations in Kenya, including KCB Group, Diamond Trust, Fina and Equity had subsidiaries in Uganda and in February this year NIC Bank obtained a license to operate a subsidiary from the Bank of Uganda. Agencies