In the face of disruptive technology, banking as a sector is staring at an unpredictable future; a future where banking services would be needed but perhaps not banks.
To stay ahead and safeguard its market leadership, Bank of Kigali decided to invest in a tech company whose key mandate would be to power innovation in creating new products and smarter ways of delivering them to customers and also improve BK’s efficiency.
For a CEO, they had to repatriate Regis Rugemanshuro a young Rwandan who was enjoying a flying career in the United States consulting for global Tech giants such as Hewlett Packard (HP) as a Programme Manager and later with Accenture PLC in Seattle, Washington.
Under his leadership, BK TecHouse already has a hot product on the market, an education management application that digitalizes the way parents interact with schools and their children; and recently, signed a partnership with Rwanda Agriculture Board that will benefit over two million farmers.
But the story of BK TecHouse is still largely abstract to many and the market is yet to grasp what value they intend to add to the economic eco-system. Trevor Amooti sat down with Rugemanshuro to explain that and more.
What exactly is BK TecHouse? What is that ‘special thing’ you say you are up to?
BK TecHouse is the Digital Innovative Power Arm of Bank of Kigali with a mandate to create more digital consumers and help BK do more with them. We have three divisions within BK TecHouse: There is the Connectivity & Internet of Things (IoT), the Digital, and Consulting divisions.
Under “Connectivity &IoT” we provide connectivity solutions such as Optic Fiber & 4G LTE through our Internet Service Provider (ISP) license as well as connect smart devices such as security cameras and monitoring solutions for enterprises and Smart homes under the IoT Unit.
We recently signed a deal with Hikvision to be the exclusive dealer for their EZVIZ line of smart home solutions in Rwanda with High Quality and affordable security cameras and alarms.
Our Digital division provides all the software and analytics solutions to our clients including Bank of Kigali. Lastly, the Consulting division is an advisory arm to help BK corporate clients reach their highest potential in the Digital Age because the bank will only continue to do well when our clients’ businesses are doing better.
Initially the company was registered in 2015 as BK Telecom, as an ISP Company, how did you become BK TecHouse?
You are right; there was a strategic shift. In late 2016, we expanded the scope of the company to meet the market demand and create more opportunities. What the market needs is not just another ISP company, there are enough of those and they are doing great with the Telco’s connecting Rwandans.
We believe connectivity is just a means to an end, just like water and electricity. Someone with a dry cleaner will buy more of both than the average household. We want to create more dry cleaners in this context and one efficient way we found to do that is to deliver value adding digital solutions that solve every day basic needs of Rwandans.
And we really went basic on this one, back to the Maslow’s pyramid of needs to make sure we get it right, thus give more people a reason to be online (digital consumers).
We are already doing this very well with one of our flagship products in Education called “Urubuto Education system” which is a comprehensive school management product that empowers both parents and educators, while giving the parents an active front seat in their children education.
The schools using our Urubuto Education System also buy more internet, and since we have an ISP License we are able to provide them with a better package for their money, including many other offerings such as our all-inclusive Smart School package which includes, Internet, the software, Smart IDs and Card readers, CCTVs as well as preferable terms for parents, teachers and students bank accounts in BK, and insurance coverage from our sister company BK General Insurance.
We intend to do the same in the agriculture, real estate and healthcare sectors. We don’t plan on reinventing the wheel, just providing more efficient ways of meeting your everyday basic needs; doing things you already do every day but helping you do them better, easily, faster and more securely.
With this strategic shift to become a technology company at core rather than an Internet service provider (ISP), it made sense to find an appropriate name. We went with “BK TecHouse”, keeping the BK identity that we are very proud of, and TecHouse to symbolize a “Rwandan Technology House” to emphasize Made in Rwanda Technology, for us and for the world.
Made in Rwanda technology; impressive as it might sound, do you have the expertise to do all that you’re promising?
We are thinking big. What we do have is the passion, the will and the expertise to solve big complex problems using technology. And I believe our financial/banking DNA combined with our strategic vision to innovate is what makes us special and will give us the edge to succeed. Because when we are innovating and solving these complex problems for our clients, we are not only thinking about returns in terms of money, but also about remarkably raising financial inclusion and promoting green and cashless economy at scale.
Talking of financial inclusion, BK TecHouse recently signed a MoU with Rwanda Agriculture Board (RAB) to digitize the Farmers Subsidy Program with your Smart Nkunganire System; what should farmers expect?
Smart Nkunganire System was inspired by what we found after analyzing our agriculture sector and wondering how to add value and radically impact the sector. Here is a sector employing more than 70 percent of the total population but in spite of that, the commercial banks’ lending to the sector currently account for only 7.4 percent of the total loans, this, according to Access to Finance Rwanda Phase one report of 2016. We concluded that by working with the right partners, BK Techouse could do something about it and significantly help banks lend more to the sector.
That is how we approached RAB and initiated a conversation that they, luckily bought into, culminating in an agreement signed two weeks ago. Under this partnership, we intend to radically improve the farmers’ subsidy program and remarkably increase lending allocated to the sector and financially transform the lives of the farmers
With Smart Nkuganire System, we expect benefits to include increased efficiency, better stock management, and traceability of both subsidies and payments at all levels across the supply chain in real time, increased transparency and reduction of fraud and human errors; the system will also bridge the communication gap between all stakeholders involved in the farmers’ subsidy program.
How exactly is this going to raise financial inclusion in the sector?
The low appetite among commercial banks to lend to agricultural sector is mainly attributed to limited data to build strong business cases to facilitate credit analysts in the assessment of loan applications from most farmers; and you can’t really blame them.
People do business with people they trust, and in general people trust people they know. The commercial banks know little if anything about the small farmers. The Smart Nkunganire System will help financial institutions and insurance companies know more about the farmers and the dynamism in the farmers Subsidy Programme, hence, subsequently making the sector more attractive to lending.
We also plan to share this information with other financial players to ensure maximum impact to the sector.
Your intentions are obviously noble but some think, instead of starting a tech company, why shouldn’t Bank of Kigali stick to what they know and do best, banking services, what’s your perspective?
If you really think about it, we are sticking to providing banking services. We are just setting ourselves up to do it even better in the digital age! If you look around and see how much and how fast technology is disrupting many industries you will quickly realize that the banking industry is no exception to what’s going on.
At BK, we understand that the role of a bank is evolving and we want to lead the disruption from within us. David Brear CEO at 11FSteam said it best during the last Dot Finance FinTech conference that took place in Kigali recently; “Digital has to mean more than just pushing analogue products via digital channels.”
At BK, we understand that in a digital world, winning and retaining customers actually hinges on creating more value for them and that is what BK TecHouse, as an innovative power arm, will achieve for the bank.
In the next 5 years, we aim to create a digital ecosystem in which the bank can play 3 additional roles besides just providing financial products and services; BK as an access facilitator: helping customers to discover products and services relevant to them; BK as a value aggregator and BK as an advice provider: using the insights we have into customers’ buying patterns to help them in managing their money and dealing with big financial milestones such as major purchases, healthcare, or retirement.
We chose not to outsource this critical responsibility.
Q: What challenges are you facing or do you foresee in the future?
Primarily, enough highly skilled engineering talent with all the right skills and the right mindset.
Those available come with high price tag. However, the situation has improved over the years and looking at everything the government is doing to attract some of the best academic institutions like Carnegie Mellon and African institute of Mathematic Sciences (AIMS) already here, the level and quality of education continuously improving across the board, there is no doubt it will continue to get better.
Secondary, the economic and social impact we are aiming to make will require a lot of collaboration with all our partners and competitors in some cases. Like the African proverb says, “if you want to go fast go alone, if you want to go far go together”.
You will see us reaching out for partnership as needed, but we understand it can be difficult to align everyone depending on circumstances and different strategic priorities.
You mentioned highly skilled and right mindset; what do you mean by the right mindset?
The mindset is as important as the skills. I agree with Steve Jobs on his belief that people with passion can change the world! You have to have this almost uncontrollable emotion and belief that you can change things for the better no matter what it takes.
In the words of President Paul Kagame, “what we have set out to do is not for the half-hearted, let alone the heartless.” I can’t say it any better, and it is true in our context as well.
At BK Techouse our people are our brand, and we go the extra mile to make sure we hire the best people. Besides your integrity, we look for five key criteria when we hire: first the passion for the profession and a strong “why” you want to work with us; second the potential, does the candidate have the needed skills and a commitment to grow and relentlessly get better; third reliability, can we count on the candidate to deliver and to ask for help when needed; and finally, can the candidate play well with others/ team player.
It is calming to know you are out to find and build mutual partnerships as opposed to deepening rivalry, but what kind of collaboration are you looking for?
For BK TecHouse it is and will always be about creating more value for our customers first and we are always seeking for win-win collaboration with anyone that helps us achieve that goal.
For instance, our partnership with RAB is a good example but another good one is a project we are working on right now in partnership with Kasha to help parents paying for their daughters’ school fees using the Urubuto Education system, at the same time be able to pay for a “going-back to school” menstrual care package to be delivered every month by kasha team at the specific school using Urubuto Education System.
It will be the first partnership of its kind but definitely not the last. The more collaboration of this kind, the faster and more efficiently we will be able to create a vibrant digital ecosystem where each player provides more value to their specific audience.
Anything you may want to add in conclusion?
It is a great time to be in the ICT industry in Rwanda and the world in general. The possibilities and opportunities ahead are tremendous. It is also important to recognize the indispensable role and impact the country’s good leadership has played to get us here.
We are able to enjoy today’s conducive business environment, a strong made in Rwanda brand, aspire to big ideas and a better future because our leadership is and has been doing all the right things.
We are grateful for the leadership that continues to work relentlessly for the Rwandan people. The best is yet to come!