KCB seeks to grow customer numbers by two million

KCB Group plans to increase its customer number by two-thirds to five million by next year as it seeks to accelerate growth.

The bank’s customers currently stand at three million, having already doubled in the 18 months to March this year. At the end of 2012, KCB had 1.28 million deposit accounts or 8.1 per cent of the market at a time its closest rival Equity Bank had more than seven million or 44 per cent of the market.

Group CEO Joshua Oigara said last Friday that the bank held 15 per cent of the market in terms of customers as at the end of March this year.

“We are now at the fourth position in the industry in terms of market share for customers, having doubled in the past 18 months. We are targeting five million by next year,” he said.

KCB’s attainment of three million customers or 15 per cent of the market shows its growth has been faster than the sector average.

Equity Bank announced in April that it closed the first quarter of the year with 8.7 million customers.

The total industry deposit accounts stood at 21.12 million at the end of last September, an increase of 2.15 million from the previous quarter, partly due to the launch of mobile banking product M-Shwari by Commercial Bank of Africa and Safaricom.

READ: M-Shwari drives increase in bank accounts to 18m

The CBK is yet to release customer figures for the end of 2013 and first quarter of this year.

Mr Oigara said the lender viewed its youthful workforce as a major positive driver of growth, noting that 60 per cent of staff are aged below 35 years.

He said the company is concentrating on consolidating its position in branches and will not open any new branches this year but in the future it would consider such countries as Ethiopia and the Democratic Republic of Congo. KCB operates in Uganda, Tanzania, Burundi, Rwanda and South Sudan.

The institution targets to improve on customer satisfaction from 82 per cent a year ago.

“We intend to increase the customer experience to 90 per cent or more. Among the initiatives we are taking towards this end is introducing Wi-Fi for internet connection in some branches,” said Mr Oigara.

He said the non-performing loans had fallen over the years, even though a few large customers owing billions of shillings had experienced difficulties repaying loans as they awaited payments for the government-funded projects they were undertaking.

The CEO refuted claims that banks were charging more than was reasonable in terms of lending rates saying the accusation did not take into account cost of funds.

“The cost of providing power and security at the branches is very high. If I were to remove the guards, that alone would cut the bank’s costs by one per cent. There is also the level of savings and inflation that affect the cost of funds,” said Mr Oigara.