PREMIUM CoB Nyakang'o flags Treasury’s delayed CBK loan repayment Overdraft facility is meant for short-term use and all such loans must be repaid by the end of the financial year. Business Just now Listen

Controller of Budget Margaret Nyakang’o has flagged the National Treasury for violating the law by failing to clear an overdraft tapped from the Central Bank of Kenya (CBK) by the end of the last financial year.

Interest on the overdraft is usually charged at a rate equivalent to the Central Bank Rate, and its use is limited to development expenditure financing in line with the Public Finance Management (PFM) Act.

The overdraft facility is usually tapped when government revenue streams such as tax receipts do not flow into the State’s accounts at a pace that matches expenditure needs.