Taarifa Business Desk has reliably learned that Kenya’s NCBA group has announced plans to set up in Ghana, Ethiopia and the Democratic Republic of Congo (DRC) as part of expanding its footprint.
The group said it is set to launch its mobile phone banking services M-Shwari in the new markets. It will seek to earn commissions from the deals over setting up brick-and-mortar operations in Ghana, Ethiopia and DRC.
NCBA has reaped huge rewards from pioneering mobile phone-based lending in Kenya after teaming up with telecoms operator Safaricom in 2012 to launch the dominant service, M-Shwari.
It wants to replicate this model outside East Africa, in particular virgin markets of Ethiopia and DRC—which have huge populations and a banking sector mainly focused on serving big companies, making them appealing to ambitious lenders in regional states in search of retail lenders and small traders for growth.
The group also operates in Tanzania, Uganda and Rwanda, is in talks for partnerships with banks and telecoms operators in the three countries for mobile phone banking services.
“In new markets the model will be to work with local banking and mobile partners to deliver our products,” NCBA Group chief executive John Gachora said in an interview.
“The countries of interest for now remain Ghana, Ethiopia and DRC – these added to our current five would make it eight countries.”
He did not disclose the banks and telcos that NCBA is seeking in the three markets. Telecoms operators have expanded mobile financial services across Africa after the idea was pioneered by Safaricom with its M-Pesa service in 2007.
NCBA has partnerships in the regions with other telecoms operators, including M-Pawa in Tanzania with Vodacom, Mokash in Uganda and Momokash (Ivory Coast) with MTN.
The bank says the partnerships will be a key plank in expansion of its digital lending business in the continent.
“As NCBA, we are looking to start seeing digital financial services as an export product beyond Kenya and into the region,” NCBA director of digital business Erick Muriuki said.
“The objective here, of course, is to ensure that we can diversify our revenues from beyond Kenya and be able to see that we are generating significantly more revenues from the digital business outside East Africa.”
Ethiopia’s State-owned mobile operator, Ethio Telecom, last May launched the mobile phone-based financial service, Telebirr.