Kenya’s Absa Bank , a part of South Africa’s Absa Group, has signed almost 5 million customers on its virtual banking platform, which it sees as a major driver for future growth, chief executive, Jeremy Awori announced yesterday.
When the bank first launched its virtual savings and loan app known as “Timiza” — Kiswahili for “Achieve” — in March 2018, it attracted 300,000 customers. By the end of the year it had 3 million users, with lending standing at 10 billion Kenyan shillings ($98.91 million).
The bank, formerly known as Barclays Kenya, also has a separate mobile-based banking service to process normal customer transactions such as deposits and withdrawals.
Absa Kenya, posted a pretax profit of 8.18 billion shillings in the first nine months of 2019, compared with 7.72 billion shillings in year-earlier period.
Kenyan lenders have in recent years , turned to technology as they try to counter competition from mobile phone-based financial services such as from telecoms operator Safaricom’s M-Pesa platform, which had 23.6 million users as of last September.
Absa’s virtual banking app’s competitors include those run by KCB Group’s, NCBA Group and Equity Group.
Pressure to use mobile banking services increased further when the government imposed a cap on commercial lending rates in 2016 that ate into bank profit margins forcing banks to search for new ways to grow their businesses. The cap was scrapped at the end of last year.