Kenya’s Equity Bank is set to open its doors in Rwanda, in the third quarter of this year, with promises of radically changing the banking practice, Business Times has learnt. The bank, however, declined to give the specific date it will roll out its operations in the country.
“It is too early to announce our launch dates as we plan to enter the market by the third quarter of this year, ”Alfred Ng’ang’a, the General manager of Blue Print Ltd, Equity bank’s Public relations(PR) firm said.
The lender is set to invest approx Rwf6.5 billion which is anticipated to boost lending to Small and Medium Enterprises (SMEs) through a new approach known as agency banking, that has been successful in Kenya.
According to the lender’s Financial Report as of the Month ending June, Equity bank has been given a go ahead by National Bank of Rwanda(BNR) to roll-out its branch network that incorporates a new approach known as agency and mobile banking.
“Agency and mobile banking model will de-congest the branch banking halls and will also enhance overall customer experience including convenience and ease of access,” the report stated.
Despite the economic challenges on the local and international scene, the bank’s first half reports says that it maintained its leading position by increasing deposits that led to a boost of it’s profit after tax registering a healthy growth of Rwf 30.9 billion up from Rwf19.7 billion compared to the same period last year, representing a 57 percent growth.
Equity Bank Group Chief Executive Officer (CEO) James Mwangi, said in the same statement the bank is geared towards maintaining its aggressive growth momentum.
“Our success has been driven by prudent risk management practices, increased efficiency and innovation on the delivery channels, products and services front,” Mwangi noted.
The Governor of Central Bank of Rwanda, Clever Gatete told Business Times in a phone interview that Equity Bank’s entry will add more value to the market as it is a respected brand in the region, adding that the bank is known to attract every segment in the market, starting from ordinary people to big businesses.
“Their entry is also going to increase penetration and also increase access to finance for the people. They have a unique model which makes them closer to their client, which I think will work for them in this market,” Gatete noted.
In a related development, that is bound to heighten competition in the sector, KCB Rwanda says that it has already secured a letter of no objection from the Central Bank allowing it to introduce agency banking in the market.
“KCB Rwanda has already a model plan for its agency banking approach. The only differentiation is that ours is technology based”, Maurice Toroitich, the Managing Director of KCB Rwanda said.