KRA to Partner with the Banking Industry for Enhanced Revenue Mobilization

Nairobi, Kenya 30th April 2024

Kenya Revenue Authority (KRA) and the Kenya Bankers Association (KBA) are set to benefit from reaffirmed commitment to foster stronger partnerships and streamline processes that drive revenue mobilization. This follows a high-level engagement between the Leadership of the two organizations that emphasized the critical role played by the banking industry and the tax agency in economic development and prosperity of the nation.

During the engagement, KRA Commissioner General Mr Humphrey Wattanga acknowledged the banking sector as a key stakeholder in Kenya’s financial sphere with a significant contribution to revenue. ‘The banking industry contributes about 10% of the total revenue that we collect and we welcome these consultative interactions for better facilitation of the sector,’ he said.

KBA Ag. Chief Executive Officer Mr Raimond Malonje reiterated KBA’s commitment to contribute to Kenya’s economic growth and support the Government in fulfilling its mandate to the people. He further added that the banking industry would collaborate with KRA to unlock any bottlenecks within the ecosystem to drive revenue growth.

KRA and KBA have previously collaborated in technical expertise and research assistance during the development of the 2022 Total Tax Contribution studies where 39 banks participated.

The Leadership engagement draws from KRA’s service-focus approach whose key objective is to enhance efficiency of the tax administration, through technology driven service delivery and tax base expansion. Through these engagements, KRA envisions a conducive environment for businesses while advancing its mission to modernize tax administration through innovative, user-friendly, and technology-driven solutions.

KRA remains committed to collaborate and continues to engage with stakeholders for enhanced compliance and service support.

Faulu Bank and Tuk Tuk Operators Network Collaborate to Provide Loans for Three-Wheeler Vehicles

NAIROBI, Kenya, 29 April 2024 – Faulu Bank, a leading financial institution committed to inclusive finance, has announced a groundbreaking partnership with the Tuk Tuk Operators Network to offer loans for three-wheeler vehicles. This partnership aims to empower individuals and members of the Tuk Tuk Operators Network by providing them with accessible financing options for entrepreneurship in the transportation sector.

The partnership between Faulu Bank and the Tuk Tuk Operators Network marks a significant milestone in promoting economic empowerment and fostering financial inclusion within communities. By leveraging Faulu Bank’s expertise in financial services and the Tuk Tuk Operators Network’s deep understanding of the transportation industry, the collaboration seeks to address the financing needs of aspiring entrepreneurs and members of the association.

Through this partnership, individuals and the network members will have access to tailored loan products designed specifically for the acquisition of three-wheeler vehicles, commonly known as tuk tuks. These loans will enable entrepreneurs to enter the transportation sector, expand their businesses, and contribute to local economic development.

“We are thrilled to partner with the Tuk Tuk Operators Network to extend loans for three-wheeler vehicles,” said Justus Kittony, Head of Business Growth & Bancassurance at Faulu Bank. “This collaboration reflects our commitment to providing inclusive financial solutions and empowering individuals to achieve their entrepreneurial aspirations. By working together, we can unlock new opportunities for economic growth and prosperity.”

“The partnership with Faulu Bank represents a significant milestone for the Tuk Tuk Association and our members,” said Vincent Were, Lead of the Tuk Tuk Operators Network. “Access to financing has been a longstanding challenge for aspiring tuk tuk operators and the network. Through this collaboration, we aim to overcome these barriers and empower entrepreneurs to thrive in the transportation industry.”

Faulu Bank and the Tuk Tuk Operators Network are committed to ensuring that individuals and the network members receive the support they need to succeed in their entrepreneurial journey. By providing accessible financing options for three-wheeler vehicles, the partnership aims to drive economic growth, create employment opportunities, and foster sustainable development within communities.

Absa Life Assurance Kenya Reports 90% Growth in Headline Earnings

Nairobi, Kenya 26th April 2024

Absa Life Assurance Kenya (Absa Life) recorded a 90% surge in headline earnings, reaching KES. 862 million for the financial year ending December 31, 2023. This impressive growth was fueled by strategic investments in product diversification, digital capabilities, and expanded distribution channels. Despite operating in an unpredictable environment, Absa Life saw double-digit increases in key performance indicators, with insurance services revenues rising by 29% to KES. 5.9 billion and investment income climbing by 27% to KES. 1.1 billion. The company’s Principal Officer and Managing Director, Githanji Waiguru, highlighted the commitment to maintaining a healthy portfolio and driving value for both policyholders and shareholders. With total assets closing at KES. 11.5 billion, up 26% from the previous year, and a return on equity (ROE) of 50.3%, Absa Life distributed KES. 450 million in dividends to shareholders. The adoption of IFRS17 standards underscored the resilience of Absa Life’s financial results, while significant investments in technology infrastructure supported operational effectiveness and efficiency gains. The company’s digital transformation agenda, coupled with a focus on Environmental, Social, and Governance (ESG) initiatives, positions Absa Life for continued growth and innovation in the Kenyan insurance market.

Faulu Bank Teams Up with Irri-Hub to Boost Farming Innovation

NAIROBI, Kenya 24th April 2024

Faulu Bank, a key player in Kenya’s financial sector, joins forces with Irri-Hub Ke Limited to empower smallholder farmers with cutting-edge irrigation solutions. This collaboration aims to enhance agricultural productivity and resilience in the face of climate change.

Faulu Bank, backed by over three decades of experience, pledges to support customers in achieving their financial goals. Meanwhile, Irri-Hub Ke Limited specializes in technology-driven irrigation solutions tailored to smallholder farmers’ needs.

The partnership will offer farmers access to solar pumps, drip kits, dam liners, and solar dryers, all aimed at maximizing efficiency and minimizing resource wastage.

Justus Kittony, Faulu Bank’s Head of Business Growth & Bancassurance, highlights the initiative’s goal of empowering farmers to adapt to climate change and achieve financial stability. Eric Onchonga, CEO of Irri-Hub Ke Limited, emphasizes the importance of transforming agriculture through technology to improve food production and resilience.

Through accessible financing options provided by Faulu Bank, smallholder farmers can acquire Irri-Hub Ke’s products, ultimately boosting agricultural productivity and promoting food security in rural communities.

Stanbic Bank Secures KES 4.3 Billion Term Debt Facility for National Cement Company Ltd’s Expansion

Subheading: Landmark Transaction Aims to Boost Production Capacity and Infrastructure Development

Nairobi, 11th April 2024: Stanbic Bank Kenya proudly announces the successful financial close of a groundbreaking deal with National Cement Company Ltd (NCCL), marking the acquisition of a KES 4.3 billion term debt facility. This strategic partnership is set to partially refinance NCCL’s foreign currency liabilities incurred during its expansive capital expenditure phase.

Driven by a mutual vision to enhance production capacity and contribute to infrastructure development in Kenya and East Africa, the collaboration between Stanbic Bank and NCCL underscores the bank’s dedication to supporting key industries and fostering sustainable economic growth across the region.

Mphokolo Makara, Executive, Head of Energy and Infrastructure East Africa at Stanbic Bank, expressed, “Our purpose at Stanbic Bank is to propel Kenya’s growth through partnerships with industry leaders like National Cement. NCCL’s local and regional market insights position them as catalysts for sustainable growth through domestic employment and manufacturing capacity.”

Stanbic Bank provided NCCL with a comprehensive financial solution, including local currency term debt and customized foreign currency forwards, as a Senior Lender. This tailored approach effectively managed the client’s foreign currency exposure relative to domestic operations, mitigating challenges posed by volatile FX market dynamics.

Alakh Kohli, Executive, Head of Corporate and Investment Banking at Stanbic Bank Kenya and South Sudan, stated, “This transaction highlights our commitment to fostering innovation and supporting the expansion endeavors of leading corporates in Kenya. We are honored to facilitate this milestone for NCCL and eagerly anticipate continued collaboration in driving economic progress.”

The KES 4.3 billion term debt facility empowers NCCL to sustainably deliver high-quality construction inputs at competitive prices, furthering economic and infrastructure development initiatives. As a pivotal supplier across East Africa, NCCL’s operations play an indispensable role in propelling growth and prosperity throughout the region.

Established in 2008, National Cement Company Ltd stands as East Africa’s foremost integrated clinker and cement manufacturer, playing a vital role in Kenya’s vibrant construction industry.

I&M Bank Empowers Solo Business Owners with Free Bank to Mobile Wallet Transfers

Extension of ‘Ni Sare Kabisa’ Proposition Demonstrates Commitment to Small Business Support and Financial Inclusion

Nairobi, April 8th, 2024 – In a move to further empower Kenya’s vibrant community of Solo Business Owners, I&M Bank has announced the extension of its ‘Ni Sare Kabisa’ proposition, offering free Bank to M-PESA and Airtel Money transfers to sole proprietorships. This expansion of the initiative underscores I&M Bank’s unwavering commitment to fostering financial inclusion and supporting the backbone of the Kenyan economy – small businesses.

More than a year since its inception, ‘Ni Sare Kabisa’ has already revolutionized the banking landscape by eliminating transfer fees for personal account holders. Now, with this latest announcement, Solo Business Owners can also avail themselves of this cost-saving benefit, reflecting I&M Bank’s dedication to easing financial burdens and enhancing opportunities for entrepreneurs.

Shameer Patel, Head of Personal & Business Banking at I&M Bank, highlighted the significant impact of the ‘Ni Sare Kabisa’ proposition on individual customers and emphasized the bank’s commitment to providing a comprehensive suite of financial solutions. “Our aim is to empower our customers with a range of offerings that not only save them money but also facilitate their financial growth and stability. With free bank to mobile wallet transfers, Solo Business Owners can now streamline their operations and focus on expanding their enterprises,” Patel remarked.

Eunice Kinyanjui, Head of Small Business at I&M Bank, emphasized the importance of catering to the unique needs of entrepreneurs and providing tailored solutions to fuel their growth. “Through extensive research and customer insights, we identified the need to extend free transfers to Solo Biz owners. By doing so, we are enabling them to access a wide range of digital financial services, including Unsecured Business Loans, Stock Financing, and convenient payment solutions,” Kinyanjui explained.

Gul Khan, CEO of I&M Bank Kenya, underscored the bank’s deep-rooted commitment to supporting small businesses, citing their pivotal role in driving economic growth and employment generation. “As we mark 50 years of I&M Bank in Kenya, we remain steadfast in our mission to empower entrepreneurs and stimulate economic prosperity. By extending our ‘Ni Sare Kabisa’ proposition to Solo Biz owners, we are enabling them to reinvest savings into their businesses and fuel innovation and expansion,” Khan affirmed.

The announcement received praise from Mr. Ben Muhati, Chairperson of the MSME Alliance, who hailed I&M Bank’s initiative as a significant step towards enhancing the financial resilience of small businesses. “Small business owners are the lifeblood of our economy, and initiatives like ‘Ni Sare Kabisa’ are instrumental in easing their financial burdens and fostering growth. I&M Bank’s commitment to supporting entrepreneurs is commendable and sets a positive example for the banking sector,” Muhati commended.

To celebrate the launch of the extended proposition, representatives from I&M Bank, small business traders, and association members embarked on a customer activation event at Gikomba, further underscoring the bank’s dedication to engaging with and supporting local businesses at the grassroots level.

Now Is the Time to Increase Financial Inclusion

Opinion Editorial

The Author Ms Janet Mawiyoo is a Trustee of the I&M Foundation and the CEO of Galvanizing Africa Consult with over 30-yrs experience in the global non-profit sector.

Since the historic World Conference for Women in 1995, known as the Beijing Conference, women worldwide, including those from Kenya, have determinedly advocated for economic empowerment. The conference marked a pivotal moment in advancing the global agenda for gender equality by adopting strategic initiatives aimed at promoting women’s economic rights and independence. These initiatives agitated for access to employment, appropriate working conditions, and empowering women with control over economic resources. Nearly three decades have passed since these measures took center stage in the public discourse and their impact has been varied.

In 2013, The Africa Development Bank defined financial inclusion as encompassing all initiatives that render formal financial services available, accessible, and affordable to every segment of the population. Achieving this goal involves addressing the needs of populations historically excluded from the formal financial sector due to factors such as income levels, volatility, gender, geographic location, type of activity, or level of financial literacy.

In the intervening years, Kenya has witnessed significant progress, marked by the implementation of diverse measures aimed at alleviating and ultimately eradicating poverty among women and girls.

In July 2019, marking 25 years post-Beijing, the Ministry of Public Service, Youth and Gender published a report on the Progress on Implementation of the Beijing Platform for Action.

Encompassing a spectrum of initiatives, the report outlines endeavors geared towards promoting gender equality in pivotal domains. Noteworthy among these is the establishment of financial mechanisms designed to facilitate access to funding. Examples include the Women’s Enterprise Fund and the Uwezo Fund, which received allocations amounting to Kes. 182.9 million and Kes. 10 billion, respectively, as disclosed in the 2023/2024 budget announcement by National Treasury Cabinet Secretary Njuguna Ndung’u.

The primary objective of these funds is to enhance women’s access to affordable credit, aligning with the broader goal of achieving Sustainable Development Goals 1 and 5, addressing poverty eradication, gender equality, and women’s empowerment. Despite these efforts, a critical question arises: why does a gap in inclusion persist and what factors contribute to its resilience?

According to the 2021 FinAccess Household Survey, a report released in 2022 by Financial Sector Deepening (FSD), 83.7% of Kenyans have access to formal financial services. Notably, the gender gap in financial access has shown improvement, decreasing from 8.5% in 2016 to 5.2% in 2019, further narrowing to 4.2% in 2021. Despite advancements in formal financial inclusion driven by increased access to mobile money, women still resort to informal channels for financing, irrespective of their income or educational levels.

This highlights the prospect of engaging women-led communities and networks. Of prominence is the trend of women involved in ‘chama’ groups; informal, communal, and social networks rooted in familial and social connections, extending financial support and across various aspects of life.

These networks are characterized by robust cohesion, with members carefully vetting each other for membership, built on a foundation of implicit trust. Typically, these ‘chamas’ also integrate some form of financial investment, through projects, table banking and revolving funds, or the exchange and trade of goods and services among members.

As the curtains come down on this year’s International Women’s Day whose theme ‘Inspire Inclusion’ underscored the significance of diversity and empowerment across all facets of society, it compels us to acknowledge and appreciate the distinctive perspectives and contributions of women hailing from diverse backgrounds, including those within marginalized communities.

By establishing pathways for women through the prioritisation of education, skills development and technological access, we unlock avenues for women to progress and contribute to a more inclusive financial sector.

As we forge forward, it is clear that is isn’t about merely about uplifting individual lives but a collective investment in a future where no woman is left behind and the potential of the next generation is unbounded. The journey towards true financial inclusion is ongoing, requiring sustained commitment, innovation and a collective societal drive to dismantle the remaining barriers.

Absa Bank Provides 105% Mortgage Financing

Rolls out financing at a fixed rate of 9.5%, with a repayment tenure of up to 25 years.

Nairobi, 14 February 2024- Absa Bank has introduced 105% mortgage financing, empowering Kenyans to realize their dreams of homeownership at a fixed interest rate of 9.5%.

This offering enables prospective homebuyers or those planning to construct their homes to access financing of up to KES 10.5 million, repayable over a flexible tenure of up to 25 years and it is accessible to individuals across all income brackets.

The 105% offering covers all associated costs including due diligence, valuation, Stamp Duty, legal fees, and transactional expenses, this comprehensive package makes homeownership more attainable than ever before.

In addition, the bank offers re-mortgage financing of up to KES 10.5 million at the same fixed interest rate of 9.5%, catering to individuals seeking to obtain a new mortgage with the bank.

Head of Mortgages at Absa Bank Kenya PLC, John Kaburu, stated that the product was developed in response to the current operating environment, aiming to assist more Kenyans in their pursuit of homeownership.

“As your financial partner, we recognize the challenges posed by the current economic climate and its effect on consumers’ purchasing power. Therefore, we have designed a mortgage solution to provide affordable credit, allowing prospective homeowners to fulfill their aspirations at ease,” said Mr. Kaburu.

This initiative reflects Absa Bank’s commitment to addressing pressing consumer needs, following a survey conducted by the Central Bank of Kenya in 2022, where commercial banks identified the high cost of property acquisition and limited access to long-term financing as major obstacles for individual borrowers seeking mortgage loans.

“As a seasoned player in the mortgage sector, we are committed to crafting solutions and experiences that cater to the unique needs of our customers. Our approach mirrors the construction of a compelling story of homeownership, wherein we act as the conductors, assembling a team of home loan specialists, legal experts, appraisers, insurance providers, and esteemed real estate professionals. This comprehensive approach aligns with our purpose of “Empowering Africa’s tomorrow, together … one story at a time” as our customers embark on life journeys of homeownership,” he added.

Absa is a founding member of the Kenya Mortgage Refinance Company (KMRC), a partially state-owned entity. Through KMRC, banks and SACCOs can access affordable housing loans, enabling them to provide financing for homeownership at a fixed interest rate of less than 10%.

Apptivate Africa and Dime Credit Collaborate to Enhance Employee Financial Wellness Through Salary Advance Program

Nairobi, Kenya 25th January 2024

Apptivate Africa, a leader in innovative workplace solutions, has entered into a strategic partnership with Dime Credit, a distinguished financial services provider. This partnership aims to introduce a revolutionary employee benefit program, empowering workers with convenient access to salary advances on behalf of their employers.

Following the escalating cost of living, and according to recent surveys, over 68% of employees report experiencing financial stress, impacting their overall well-being and productivity, hence there is a rising demand for employer-supported financial solutions, with over 80% of employees expressing interest in salary advance programs. 

The collaboration between Apptivate Africa and Dime Credit signifies a strategic alliance aimed at addressing the financial well-being of employees. This program will provide employees with a seamless process to access salary advances, helping bridge financial gaps and promote stability.

“We are delighted to join forces with Dime Credit to launch this transformative employee benefit program. These statistics underline the critical need for accessible financial solutions, and through this collaboration, we aim to make a meaningful impact on the lives of employees,” said Neil Ribeiro, CEO, Apptivate Africa.

Apptivate Africa is committed to redefining the employee experience by offering cutting-edge workplace solutions. With a focus on enhancing financial well-being, Apptivate Africa consistently seeks impactful partnerships to bring valuable benefits to the workforce.

“Dime Credit is excited to partner with Apptivate Africa to address the growing demand for employee-focused financial solutions. These statistics underscore the urgency of providing accessible salary advances, contributing to a financially empowered workforce,” added Fernandes- Director, Dime.

Dime Credit is a trusted financial institution known for its dedication to providing accessible and flexible financial solutions. Aligned with Apptivate Africa’s vision for a financially resilient workforce, Dime Credit brings expertise and reliability to the partnership.

Key Features and Statistics of the Program:

Convenience: Over 90% of surveyed employees expressed a preference for convenient and digital solutions for accessing financial benefits. The program offers a user-friendly platform integrated into the Apptivate Africa ecosystem.

Swift Processing: The streamlined application process ensures quick approval and disbursement of funds, with 85% of advances processed within 24 hours.

Transparent Terms: Transparency is a cornerstone of the program, with 95% of surveyed employees expressing the importance of clear terms and conditions for financial benefits.

SUPERIOR HOMES KENYA AND ABSA BANK ENTER A FINANCING DEAL TO BOOST MORTGAGE LENDING

Nairobi, January 24, 2024 – Leading real estate developer Superior Homes (Kenya) PLC has signed a partnership with Absa Bank Kenya that will see home buyers enjoy 90 percent financing.

Through the partnership, Absa Bank Kenya will provide mortgages with terms of up to 25 years for existing and prospective investors seeking to buy housing units at Pazuri at Vipingo, a holiday homes development by Superior Homes located in Kilifi County. The deal seeks to also provide an avenue for cross-marketing between the two entities.

A 2022 Central Bank of Kenya’s Bank Supervision Annual Report cited high cost of property purchase and limited access to long-term financing as the main factors hindering Kenyans from accessing mortgage loans.

Superior Homes Kenya Head of Sales Clive Ndege said that the partnership marks a significant milestone in their quest to help more Kenyans achieve their home ownership dreams while at the same time addressing the current housing deficit in the country.

“As a company, we strive to see more Kenyans achieving their homeownership dream. With this partnership, with Absa Bank Kenya, a like-minded partner who shares the same dream, our clients are assured of hassle-free process of owning a home,” said Superior Homes Kenya Head of Sales, Clive Ndege.  

According to the Kenya Property Developers Association (KPDA), the current housing deficit is estimated to stand at 2 million houses which continues to rise due to fundamental constraints on both the demand and supply side and is exacerbated by an urbanization rate of 4.2 percent, equivalent to 0.5 million new city dwellers every year.

Speaking during the event, Absa Bank Kenya Regional Manager and Head of Mortgage John Kaburu said that strategic partnerships were a key pillar for the Bank adding that this new partnership with Superior Homes marks the start of a journey towards unlocking and fulfilling more home ownership dreams for Kenyans.

“At Absa Bank, we value the aspect of building partnerships, collaborations, and working with the eco-systems and we are happy to start this journey with Superior Homes Kenya as our key partners in the real estate sector. Besides the mortgage agenda, there are more financial solutions that we will be offering, including financial literacy through enlightening homeowners on the need to secure their investments,” said Mr. Kaburu.