Kenya Commercial Bank (KCB) has signed up 1.8mn subscribers for its mobile phone-based banking services, according to the bank’s chief financial officer Lawrence Kimathi
KCB, Kenya’s biggest bank in terms of assets, launched its mobile phone-based service in March this year. The service named KCB M-Pesa is a partnership between the bank and telecom operator Safaricom, which had launched the M-Pesa service in 2007.
The KCB M-Pesa service allows users to deposit cash into their accounts and to borrow up to US$10,300 for a period not longer than six months, using their mobile devices.
The bank has already lent more than US$14.1mn to around 400,000 borrowers and according to Kimathi, the service is on course to achieve its target of 10mn users within a year. Around the time of the service launch in March, chief executive Joshua Oigara had said he expects KCB M-Pesa to account for 20 to 30 per cent of the bank’s lending in the future.
According to analysts, KCB has benefited from partnering with Safaricom instead of having to set up its own system. Despite having to share earnings with Safaricom, this has given the bank an advantage over competitors who have to attract customers to their newer, less widely-known services. Companies like Equity Bank and Standard Chartered Kenya have invested in systems that allow users to access their accounts any time. The ratio in which the earnings will be shared and other financial details of the KCB-Safaricom deal have not been made public.
