Top Belgian financial services firm to make Nairobi regional hub

Global financial services firm SWIFT plans to open a regional hub in Nairobi, with eye on mobile money and the securities market.

The Belgium-based company, known mostly for facilitating electronic bank transfers, is hunting for an executive to head the Nairobi regional office, boosting Kenya’s claim to the status of regional financial services hub.

SWIFT (Society for Worldwide Interbank Financial Telecommunications) offers a platform which interlinks banks and other financial institutions around the world to allow electronic funds transfer across multiple currencies.

“To support our ambitions in the East Africa region, SWIFT will be opening an office in Nairobi, Kenya,” says the firm in a notice.

“We are recruiting an account manager to further enhance our strategic partnerships and drive sales growth and market development in the region.”

The payments processing network is now training its eyes on the fledgling mobile money industry as well as clearing and settling deals in the capital markets.

The Nairobi office becomes the second in Africa after SWIFT’s pioneer hub in Johannesburg.

The SWIFT Nairobi office bolsters Kenya’s position as an emerging Africa financial services hub, given that Nairobi already hosts firms such as MasterCard, Visa, World Bank, African Development Bank (AfDB) and representative offices of several global lenders.

READ: Kenya ranked second in Africa as investment hub for global firms

SWIFT specialises in four areas, with payments and securities accounting for more than 90 per cent of deals while treasury and trade services make up the rest.

The network securely exchanges information between financial institutions through encrypted messages and codes to make transactions.

It said about 5.6 billion messages or transactions were recorded globally in 2014, or 24.62 million messages per day – with Europe, Middle East and Africa accounting for two-thirds of the total volume.

The SWIFT network comprises more than 10,500 financial institutions — including Kenya’s 44 banks—in 2015 countries around the globe.
SWIFT says it will focus on developing and integrating mobile money platforms across Africa.

“SWIFT’s focus is on financial inclusion and support for new research on the development of mobile payments in Africa,” said Gottfried Leibbrandt, the firm’s CEO in the latest annual report.

The Kenya Bankers Association (KBA) said the mobile money space offers a lot of opportunities for players such as SWIFT, given the need to interlink rival mobile platforms.

“There is need for interoperability of mobile money payments and this is an area they can explore,” said Habil Olaka, chief executive of KBA.

Kenya has 24.9 million mobile money users who transact across six platforms that are not interlinked — M-Pesa, MobiKash, Airtel Money, yuCash, Orange Money and Tangaza — backed by a network of more than 121,000 agents.

The country has gained global reputation with the innovation of mobile money service M-Pesa and the mass uptake of mobile cash transactions which grossed Sh2.1 trillion in the period to November last year – which is equivalent to 45.1 per cent of newly rebased GDP.

Ericsson is currently searching for a techie to head its mobile money business to be based in Nairobi, saying it has is identified mobile cash as a high growth area in the coming years.

SWIFT currently provides the backbone of the East African Payment System (EAPS) which went live in November 2013, offering real time settlement of transactions between Kenya, Tanzania, Uganda and Rwanda.

SWIFT is also eying business opportunities in the securities market by deploying a platform where stock brokers and bond dealers can connect with customers to take orders, process payments and settle trades.

“African securities markets are on the cusp of transformational development. This is clear from SWIFT securities traffic growth and by the rising volumes,” said Ian Bessarabia, head of business development, sub-Saharan Africa, SWIFT.

“Standardised clearing and settlements processes will help to drive up trading volumes and boost liquidity by improving efficiency, cutting cost and eliminating risk,” said Mr Bessarabia in a statement.