Key Microfinance plans four new branches as the lender rebrands to LOLC Kenya Microfinance following acquisition by LOLC Holdings Plc, Sri Lanka’s second-largest publicly traded company.
The new buyers have set an expansion target for the microlender previously known as Remu Microfinance targeting at least four outlets by the end of the year.
Remu was more of a regional lender with branches in Nairobi, Meru and Maua, but the new buyers are building a new fully-fledged micro lender with a national and regional focus.
The lenders’ CEO Gregory Siro said Lolc Kenya Microfinance has already opened an outlet in downtown Nairobi as it prepares to expand throughout the country after the August general polls.
The lender said in a notice the board and management of Key Microfinance approved the rebranding and change of name to Lolc Kenya Microfinance Bank.
“We have opened one branch in Nairobi and are targeting four sites by the end of the year to bring our branches to seven,” Mr Siro said.
The lender which received regulatory approval to acquire 73 percent shareholding of Key Microfinance is currently working on its core banking system to improve efficiency and compete in a tight microlending environment.
LOLC Holdings Plc is also expected to help link its new local subsidiary to global capital through multi-lateral funding partners ranging from development funding institutes to commercial banks at favourable terms.
The Sri Lankan financial service firm Lolc Holding has been mulling expanding operations into Kenya as it seeks to tap the rising demand for microcredit.
In 2019 the firm, which also runs two micro-lenders in Cambodia, said it planned to sell its stake in one of the units in Cambodia and use the proceeds to fund the acquisition of unnamed micro-financiers in Kenya.
The firm, which gets about 84 percent of its pretax income from overseas, also plans to expand into Uganda, Tanzania, Zimbabwe and Mozambique.
The LOLC Group has already expanded its footprint to the African continent - Nigeria and Zambia in West and East Africa respectively.
The group made its maiden finance sector investment in the African region by acquiring a controlling stake of FinaTrust Microfinance Bank in Nigeria and thereafter commenced operations in Zambia by incorporating LOLC Finance Zambia as a greenfield operation.
Its expansion into East Africa with a foothold in Kenya with a target for other markets within the region.
