Loans and interest
When you borrow money from a bank, SACCO or savings group, the amount you are required to pay back will always include interest rates and any other additional charges or fees.
The interest rate is the cost of borrowing money. This is usually a percentage value on an annual basis or a monthly basis. When you pay back the money borrowed, you will pay the original amount plus this interest rate.
This interest rate might be different if you borrow money for a short period of time than when you borrow money for a long period of time. The interest rate can also go up or down at any time and this can be due to inflation, market forces and even regulations by the central bank.
