Mobile and Agency Banking Propel KCB Bank to Profit Growth

Joshua Oigara
Joshua Oigara, KCB Bank Group CEO

Joshua Oigara

KCB Bank Group has today announced their half-year financials and indicators show a budding love for agency banking, mobile banking and surprise, surprise, card payments are also on the rise. The bank acknowledged that teller transactions are on the decline, a trend they note is in line with their digital transformation agenda.

β€œIn line with the digital transformation strategy, transactional activity continued to shift away from branches, with non-branch transactions; mobile, agency banking, point of sale terminals and ATMs, standing at 87% of total volumes,” said Joshua Oigara, KCB Bank Group CEO.

The bank posted a 17.48% growth in net profit, which translates to 12.1 Billion shillings made in the first half of 2018. Among other factors that led to this growth, mobile banking saw a 34% growth in volumes, however, the number of transactions dropped slightly. There were 26.6 Billion mobile banking transactions performed, that saw 156 Billion shillings moved.

Interestingly, consumer to business transactions saw a dip from 19.3% in H1 2017 to 16.7% this period. Business to Consumer payments also dropped but Business to Business transactions grew by 9.2% compared to the same period last year.

84% Growth On Agency Banking

KCB Bank launched the KCB Mtaani agency banking program back in 2011 and ever since these decision has proved to among the best ever made. However, the growth of branchless banking has led to the decline of teller transactions which could be futile for bank employees.

In the first half of 218, KCB Bank posted an 84% growth in agency banking with over 101 Billion shillings moved across these agents. Among the transactions, cash deposits were on the rise, followed by payment of school fees. Interestingly, a decline in withdrawals was witnessed, a phenomenon that we have been seeing in mobile money services.

Card Payments On the Rise

After an aggressive push in a bid to counter the growth of mobile money services such as M-Pesa, banks have been encouraging customers to use their debit cards to pay for services. This hard work seems to be paying off as KCB Bank has posted a modest 10% growth in card payments. The value of card transactions went up from 22 Billion shillings in H1 2017 to 24 Billion this time around, a good sign that maybe, cashless payments are finally taking off in Kenya.