KCB reaches out to the diaspora market

KCB Group is stepping harder on the gas paddle in the race to win more customers, and steering its quest for businesses overseas.

In what is shaping up as the next battlefront for banks, Kenya’s biggest bank in terms of branch network, has launched the Diaspora Banking service targeting the 12 million-plus East Africans living or working abroad.

Ms Angela Mwiriga, the group’s director of marketing and communication, said the new account would provide Eastern Africans in foreign countries with reliable banking and investment services.

“The intention is to give them an opportunity to open an account and control their money from wherever they are in the world,” she said in an interview.

The service comes with a number of accounts – current, transactional, student, investment and junior account – which can be serviced through cheques and electronic (internet and mobile) banking. There have been cases of some Kenyans living in the Diaspora losing their hard-earned money to unscrupulous relatives or middlemen while investing back home, particularly in real estate.

This hurdle is replicated in Eastern Africa and KCB is tapping the frustration of this group with mortgage financing. Through its mortgage subsidiary S&L (Savings and Loans), the bank posts available properties to those in the diaspora.

It then provides mortgage financing for residential or commercial property purchase or construction, plot purchase and top-up loans against existing properties. Competition among local banks in Kenya has spilt over to neigbouring countries – especially Uganda, Rwanda and South Sudan – as the home market gets too competitive, thanks to the rise of micro-finance institutions in the slums and villages.

To grow numbers, the big banks are getting more creative, and now focus is shifting to the diaspora Kenyans which, according to Central Bank of Kenya, remitted home Sh51.3 billion last year and the amount has been growing month on month. KCB’s diaspora banking will enable Kenyans to invest back in the regional stock markets, Ms Mwiriga said.

Diaspora Banking offers round-the-clock electronic and mobile banking. Eastern Africans living abroad can transact online, giving the safety and convenience. They can also transfer money from the KCB Diaspora account to other accounts globally even outside the KCB system.

They can use the account pay utility bills back home, including electricity and water bills, she said. “Eastern Africans out there now do not have the challenge of trying to give someone who is coming home their $100 only to fail to reach, ” Ms Mwiriga says.

The Diaspora Banking platform was launched a month ago in Kenya, Tanzania, South Sudan, Uganda, Rwanda and Burundi. Ms Mwariga says the bank has already accumulated deposits of about Sh100 million from almost 5,000 customers. KCB seized the London Olympics to market the service.

She said it has partnered with Brand Kenya Board as a major sponsor to establish the inaugural Kenya House at the Olympics. Other Kenyan companies will also showcase their products and services.

“We are expecting over 20,000 visitors to come through the doors at the Kenya House in London,” she said. “We will be showing the Diaspora Banking to all the Eastern Africans. We are driving traffic to Kenya House by offering iPads to be won by those who will have been to at least three different events.”