CBA chief Jeremy Ngunze briefs investors at the Nairobi Serena Hotel on October 3, 2016. PHOTO | DIANA NGILA
What you need to know:
CBA says Rwanda’s growing mobile penetration will be key for the plan set to be rolled out by December.
Commercial Bank of Africa has set its eyes on the Rwandan market with its M-Shwari product which already has millions of users in Kenya, Uganda and Tanzania.
The bank, which recently announced it had hit the 600,000 subscriber mark on its Ugandan mobile-banking platform (MoKash) in partnership with MTN Uganda, said Rwanda’s growing mobile penetration would be key for the plan set to be rolled out by December.
Chief executive Jeremy Ngunze on Tuesday said the service would be seeking to sell the convenience it offers over other banking channels to push the product in Rwanda as it has done in the three countries.
“We have people in some of these countries who are able to move cash on mobile among themselves but the gap that exists in savings and borrowing remains unexploited.
“The privacy and convenience that comes with borrowing on your mobile phone are our key strengths and we will use raw data to drive this crucial service. We are looking at Rwanda in quarter four and other countries will follow,” Mr Ngunze said in an interview after an investors briefing in Nairobi.
M-Shwari now has 16 million customers in Kenya with 80,000 users borrowing on the platform daily. This has seen some Sh106 billion disbursed in the region.
Mobile phone subscription in Rwanda had hit 8.807 million in March 2016 according to the Rwanda Utilities Regulatory Authority subscription statistics.
Tigo Rwanda, which had 3.115 million in March from 3.112 million active subscribers in February, could be the most likely partner in the venture.
M-Shwari also plans to venture into other markets which the CEO said would be defined by mobile phone access and data availability.
M-Shwari has held to the position that its mobile-based loans are not subject to the recent interest rate caps as it was licensed as a fees and not interest-charging product.
“The nature of our borrowers don’t fall within that lending rationale because they sometimes repay within one hour. How do you compute that within the annual interest rates?
The interest capping for us only means we have to ensure we have higher productivity and innovation to make the services efficient for our business,” said Mr Ngunze.
M-Shwari also plans to launch a mobile phone application.
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