KCB launches M-Benki in race for micro-deposits

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Cabinet Secretary for Information, Communications and Technology (ICT) Fred Matiang’i (left\0, Kenya Commercial Bank Group chief executive officer Joshua Oigara and Safaricom Limited CEO Bob Collymore (right) during the launch of a mobile banking product dubbed KCB M-Benki targeted at the unbanked population in Kenya and the region. Photo/SALATON NJAU  Nation Media Group

By Scola Kamau, The EastAfrican, Special Correspondent

Posted  Tuesday, October 15  2013 at  15:16

In Summary

• KCB Group has launched a mobile banking platform targeted at the unbanked population that allows customers to open a bank account without physically visiting a branch.
• The platform dubbed KCB M-Benki, which will be available in Kenya, allows customers to open an account under Safaricom’s M-Pesa menu with as little as Ksh1 ($0.01).
• The launch of KCB Group’s new platform comes almost a year after Commercial Bank of Africa (CBA) and Safaricom launched a banking platform dubbed M-Shwari that allows customers to open up an account and access micro loans from the bank.

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KCB Group has launched a mobile banking platform targeted at the unbanked population, that allows customers to open a bank account without physically visiting a branch.

The platform dubbed KCB M-Benki, which will be available in Kenya, allows customers to open an account under Safaricom’s M-Pesa menu with as little as Ksh1 ($0.01).

The launch of KCB Group’s new platform comes almost a year after Commercial Bank of Africa (CBA) and Safaricom launched a banking platform dubbed M-Shwari that allows customers to open up an account and access micro loans from the bank.

READ: Kenya’s M-Shwari transactions hit $445.9 million

“With the growth of mobile phones penetration, the product will be accessible to the unbanked population across the country,” said Joshua Oigara, KCB Group chief executive officer adding that other countries will be considered in the near future.

The platform is hoped to bring a larger population into formal banking, benefit the small and medium enterprises and reduce time spent in opening accounts.

“One automatically becomes a member of KCB and can carry out all other transactions using a mobile phone,” said Mr Oigara during the launch.

KCB Group, which is Kenya’s largest bank in terms of assets, also has operations in Uganda, Tanzania, Rwanda, Burundi and South Sudan.

After CBA’s launch of M-Shwari, micro-loans offered by Safaricom’s virtual banking platform M-Shwari rose by almost 10 times over the seven month period ended July this year, according to data from the Central Bank of Kenya (CBK).

READ: Number of banked households rises, buoyed by reforms in financial services

Total cumulative loans issued under M-Shwari stood at Ksh3.2 billion ($36.7 million) in July 2013, from Ksh337.6 million ($3.88 million) in January 2013 while the total value of savings stood at Ksh1.39 billion ($15.9 million), up from Ksh451.9 million ($5.194 million) over the same time period.

“Accessing all bank services through the phone encourages people to make commitments; we hope to see the banked population rise with more of such products from all sectors,” said Fred Matiang’i cabinet secretary in the ministry of Information Communication and Technology.

KCB Group’s M-Benki launch comes at a time more financial service providers have followed in the footsteps of mobile phone service providers like Safaricom, Airtel, Telkom Kenya and Eassar who have put in place options to enhance mobile bill settlements.

These options have enabled customers to pay for utility bills including electricity and water and are now allowing customers to even purchase goods at various retail outlets.