Equity Bank is closing some of its ATMs as the lender shifts customers to mobile and agency banking.
The bank has so far closed 11 ATM lobbies, each of which had multiple cash dispensing machines.
Kenyan banks have turned to job cuts, branch closures and deploying technology to cut costs and adapt to the rate caps era.
Equity Bank #ticker:EQTY has started closing some of its automated teller machines (ATMs) as the lender shifts customers to alternative channels such as agency and mobile banking in a fresh cost-cutting strategy.
Kenya’s biggest bank by customer numbers told the Business Daily it has so far closed 11 ATM lobbies, each of which had multiple cash dispensing machines.
Equity’s chief executive James Mwangi reckoned that while ATMs require upfront capital investments to acquire the machines and lease space yet depreciate at 20 per cent annually, agency and mobile banking have no such capital commitments.
He also added that the shift is informed by evolving preferences of its 9.59 million customers who want to do their banking on the go through mobile phones, or access banking within their neighbourbood via agents.
“Last year Equity conducted a survey and the findings were customers prefer self-service digital banking and have a higher preference for convenience in payment platforms and access to loans,” said Mr Mwangi in an interview.
Equity Bank’s m-banking service Equitel processed 227.4 million transactions in the year to December 2016, followed by agents (61.9 million deals), ATMs (24.8 million), and 20.4 million dealings at its brick-and-mortar branches.
It had 29,561 agents and 1.4 million Equitel subscribers in the period under review.
One in every five ATMs in Kenya belongs to Equity Bank, thanks to an aggressive expansion strategy. It had 520 ATMs as at December 2016 when the total industry count was 2,656 machines, according to Central Bank of Kenya data.
Kenyan banks have turned to job cuts, branch closures and deploying technology to cut costs and adapt to the rate caps era.
Equity’s rivals that have closed or plan to close branches include Barclays #ticker:BBK (seven), StanChart #ticker:SCBK (four), Bank of Africa (12) and Ecobank (nine).
