It is the moment that the banking industry in Kenya is facing a lot of challenges especially on governance issues, leading to a decline on public confidence.
A situation that saw Swiss company NetGuardians launching a software solution which combines the banking industry knowledge with advanced analytics that enable banks to detect and prevent fraud before it happens.
However, Equity group which has retained for the fourth time, the best overall bank in Kenya in the 2016 Think Business Awards seems to not understand this vocabulary as it is reflected in its latest first quarter financial results of 2016 released today.
From the results, there is a record of 20% profit after tax for the year ended march 31st 2016 as it grew from 4.3 billion to Ksh.5.1 billion for the same period last year. This has been delivered by a 22% growth in loan book and a 28% growth in government securities.
It is also interesting to note from this statistics that most customers have turned to digital banking as a way of carrying out transactions, and in this case by use of Equitel.
Most importantly the report indicates a growth of 315% of transactions in terms of numbers on Equitel alone as transactions from the bank branches and ATM reduces by -15% on both.
Ksh 4B disbursed through Equitel.
Yet others somewhere are closing down MPESA! Mobile banking is the way to go! #EquityQ12016
— Sir Ezer (@Kipezer) May 10, 2016
That growth saw transactions moving from 11 million to 45.6 million transactions More to this, Equitel, the thin sim technology launched in 2015 also recorded a 562% increase in terms of transaction value, moving from 9.4 billion in 2015 to 62.4 billion in 2016 Its customer base grew with 180% while transactions carried out from it grew to 196.6 million up from 35.8 million in March last year.
Of the loans disbursed via by the group, 81% are through Equitel while only 19 % are through the group banking branches. In addition, more transactions have also been carried out from the agents, as the report indicated a 26% profit in that area.
Equitel Market Share
Despite a decrease of mobile subscriptions dropping from 37.8 million as recorded in the Communication Authority second quarter report to 37.7 million, Equitel still managed to acquire a market share of 0.8 per cent during the quarter to attain 3.7 per cent market share.
The volume of transactions (deposits and withdrawals) on this platform was registered at 333.2 million with 813.7 billion Kenya Shillings transferred among users during the period.
Mobile commerce recorded a total of 138.6 million transactions with 275.8 billion Kenya Shillings was used to pay for goods and services. The person-to-person transfers stood at 393.3 billion Kenya shillings
— Alex Chamwada OGW (@AlexChamwada) May 10, 2016
With this numbers it is evident that Equitel is a gamer changer in Equity Group operations and without keen attention by other industry players, such as MPESA,Airtel Money, KCB-MPESA ,Orange Money and others, Equitel is likely to make a huge turnover on matters digital banking.
Generally, from the report ,Net loans grew from Kshs.225 billion to Kshs.275 billion while government securities grew from Kshs.49 billion to Kshs.62 billion.
The balance sheet and total funding grew by 16% from Kshs.373 billion to Kshs.430 billion. The Group also restructured its balance sheet to take full advantage of the prevailing micro economic environment to optimize on earning.