Convenience, affordable interest rates and easy access of loans have made the mobile banking platform so popular that the number of people using them is growing at a record pace.
For some of the banks, the number of people taking loans through the platforms is half the number of their total customers, pointing to the fact that mobile phone transactions are the new frontier for business growth.
Kenya Commercial Bank (KCB) and Equity Bank are among the financial institutions that have made great strides in offering loans via the mobile phone.
Their financial results released this week paint a bright future for the growth of the nascent technology introduced barely three weeks ago.
KCB runs the KCB-MPesa service, Equity Bank, on the other hand, has Equitel. KCB has partnered with leading telecom Safaricom to offer the mobile phone loans while Equity runs its service independently.
In the last financial year, KCB saw the number of its customers using the service started barely two years ago stand at a record five million and over 90 million U.S. dollars borrowed via mobile phone.
The story is no different for Equity Bank’s Equitel, which had about two million customers registered in the last financial year and over 84 million dollars borrowed via mobile phone.
“With the fast growth of mobile banking in Kenya due to wide use of mobile money, banks can only ignore the technology at their own peril. It is the new frontier and if you look keenly, banks that have embraced the service are the ones posting huge profits,” said Henry Wandera, an economics lecturer based in Nairobi.
Kenya Bankers Association noted that more banks are launching mobile phone services to tap the lucrative market. Enditem