KCB Group, Kenya’s largest bank based on assets, is reportedly in talks with Facebook, Apple and Alibaba Group about working together on digital payments.
In a Bloomberg report citing KCB Chief Executive Joshua Oigara, the news service reported the collaboration would happen through its financial technology unit. The bank is also talking to Alphabet and Tencent and is part of KCB’s efforts to double the number of customers that use its mobile platform. The company wants to have 20 million customers using it by the end of next year. The unit, to be called KCB Fintech, will start operations in June 2017. Oigara told Bloomberg the unit will "partner with different players, whether it is M-Pesa, Facebook, Google, Apple, and that business will have a new digital payments platform.”
The report noted that KCB is doubling the capacity of its mobile phone systems so it can support 600 transactions per second in 2017. The company is also in talks with PayPal, Samsung Electronics and Twitter. “This is the journey we are going through,” Chief Digital Officer Edward Ndichu, who will lead the KCB Fintech unit, said. “We need to benchmark with the needs of the customer.”
The move comes at a time when banks are fighting for market share in East Africa’s largest economy. That’s because there are 25 million mobile money customers spending $3.1 billion on goods and services in the three months ended at the end of March, Bloomberg reported. Last spring, a report showed consumers in Kenya, Uganda, Rwanda and Tanzania were transacting a massive amount of money through their mobile phones. That amount, in fact, hit $45.74 billion in 2014, which was 32 percent of their combined GDP, according to an AllAfrica news report. That’s a significant five-year jump from 2009’s figures of $4.86 billion, which only accounted for 3.4 percent of GDP. Having the ability to move money via mobile also enables consumers in those regions to move money more on average than before mobile money services were widespread as viable options.