One of Kenya’s largest mobile operators, Safaricom, and Equity Bank, a microfinance bank based in Nairobi, have released M-Kesho, a new mobile banking product, which will target rural areas [1]. M-Kesho will allow M-Pesa (Safaricom’s mobile money transfer service) account holders to access a greater variety of services: money deposit, cash withdrawal and loan access. According to James Mwangi, a chief executive of Equity Bank, essentially, M-Kesho will transform M-Pesa accounts into bank accounts. However, M-Kesho will not be regulated as tightly as are banking services. M-Pesa customers will now be able to open “savings accounts” from which they can transfer as little as KSH 100 (USD 1.3) at no cost. M-Kesho subscribers will also be able to access microcredit and microinsurance products. The President of Kenya, Mwai Kibaki, speaking at the launch in Nairobi, described M-Kesho as, “A landmark product that will integrate the telecommunications and banking sectors and [will] improve access to cost effective financial services” [1].
About Equity Bank:
Equity Bank, founded in 1984, is a microfinance bank based in Nairobi, Kenya. It provides loans, savings, and fund transfer services, and it is funded through its savings deposits and shareholder capital. It accounts for 52 percent of bank accounts in Kenya with over 4.1 million accounts. It is involved in microfinance operations not only in Kenya, but also in Southern Sudan and Uganda through its subsidiary, Equity Bank Uganda.
As reported to the Microfinance Information Exchange (MIX) Market in 2009, Equity Bank has USD 1.27 billion in total assets, a gross loan portfolio of USD 818 million and 716,000 active borrowers.
By Conner Brannen, Research Assistant
Sources and Resources:
[1] How We Made It In Africa: “New Mobile Banking Product Launched in Kenya,” by Dinfin Mulupi, May 19, 2010: http://allafrica.com/stories/201005190099.html
[2] MicroCapital Universe Profile: Equity Bank: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Equity+Bank
[3] MICROFINANCE EVENT: IIR To Host Mobile Money Services Africa in Johannesburg, South Africa, July 20 to July 22, 2010: https://www.microcapital.org/microfinance-event-iir-to-host-mobile-money-services-africa-in-johannesburg-south-africa-july-20-to-july-22-2010/
[4] MICROFINANCE EVENT: Mobile Finance for the Unbanked to Be Hosted in London July 12-13, 2010: https://www.microcapital.org/microfinance-event-mobile-finance-for-the-unbanked-to-be-hosted-in-london-july-12-13-2010/
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