Kenya Commercial Bank Rwanda has launched ‘KCB Mobiloan’, a mobile based loan product that enables customers to apply and receive loans into their bank accounts.
The product that started operating in May this year, allows every customers a pre-determined limit between Rwf 500 to Rwf 500,000 which is largely dependent on the amount and frequency of transactions customers make on their accounts.
Speaking at the launch, KCB Bank Rwanda Acting Managing Director, George Odhiambo, said that the mobile technology product was introduced to enhance customer’s expediency in accessing financial services.
“Customers today are looking for convenience in most areas of service delivery. This new mobile technology is therefore essential in facilitating ease of service for our customers.”
Odhiambo also refuted perceptions that Rwandans are not familiar with banking technology, noting that in reality, the country’s population is predominantly made up of young people, who leverage on easy access to internet to acquire information swiftly.
He said that the adoption of mobile phone apps is itself an indicator that Rwandans are very keen to use technology which makes that perception incorrect.
“We have seen many young people who have told us that they want to do banking, but cannot see us. We are now taking banks to their houses and pockets. That is what we are doing and it is because they are good in technology. The Wi-Fi is everywhere in Kigali,” he said.
The National Bank of Rwanda reports that the banking sector holds around 66.9 percent of the total financial sector assets.
According to the BNR’s 2017 monetary policy and financial stability statement, the total assets of the banking sector continued to grow in 2016, albeit at a lower rate compared to last year. Total assets grew by 11.5 percent at end December 2016 (from Rwf 2,133 billion to Rwf 2,378 billion) compared to 18.3 percent registered at end December 2015.
This decelerated growth of assets, the statement reads, is largely attributable to slowdown of growth of loans in 2016. Loans and advances, the largest component of banks’ assets (59.2 percent of total assets) increased by 14.6 percent, lower than 18.3 percent recorded in 2015.
The slowdown of domestic demand in 2016 affected business earnings and reduced their demand for credit to expand their businesses. The total amount loan applications received by banks declined from Rwf 937 billion in 2015 to Rwf 861 billion in 2016.
The new KCB’s ‘Mobiloan’ introduces easy application and reception of loans to small and medium businesses for expansion.
How Mobiloan Works
The product is available to every KCB Bank customer registered on Mobile banking services. Customers can access Mobiloan by dialing *522# and following the prompts.
A customer must also be an active account holder for at least 6 months with a good track record as per predefined criteria to be able to access a mobiloan.
Customers are required to pay their mobiloan after 30 days. Customers can check their loan status as well as repay the loan using their phone at any time during the recommended payback period. The commission for mobiloan is 6%.