A Look at the Banking Sector in Kenya and the Importance of Banking Surveys

The Kenyan banking sector is a story of its own kind. It is a story that keeps on unfolding daily, weekly, monthly and annually and sometimes, it needs a third eye to see beyond the change.

Since the time we used to make endless queues in banking halls to do such simple tasks as depositing cash or withdrawing as little as 500 shillings, to the coming of Automatic Teller Machines (ATMs) and now mobile.

A mobile phone, though small and simple in appearance, is the real story behind the revolution of the banking sector in Kenya. In fact, all banks in the country have moved almost all their banking services from traditional banking halls to mobile. Customers attached to various banks can now comfortably transact using their mobile phone in the comfort of their homes or even offices.

Most of the times, however, it is not easy to understand how banks operate just from the face of it unless there is an expert to take you through it. For most people, banks are entities in the business of receiving and lending out other people’s money while for some, banks are just places where they ‘store’ their cash awaiting expenditure.

Many commercial banks in Kenya have found themselves ‘on the wrong side’ of their customers, not because they have done something wrong but just because most of them don’t understand their own banks. Social media has even made matters worse where people have been spreading innuendos and unfounded truths about financial institutions causing panic among customers.

Banking surveys, however, have been instrumental in bringing more light into people’s perception of the banking sector in Kenya. Most of these surveys explain how banks work and rank them according to their performances.

I had the privilege of attending the release of the Banking Survey 2018 that had been conducted by Think Business. I attended the event because I knew that my bank – since I started banking – Barclays Bank of Kenya would be among them and my crystal ball wasn’t wrong. My bank was there.

For instance, during the award ceremony, my bank scooped the 1st runners-up position in the Best Bank in Tier 1. It was also voted as the most prestigious bank and it was the second most stable bank too. In the overall ranking, my lender was among the top five banks in the country in almost all the categories.

The truth is most banks in Kenya have failed due to poor customer relationships. Majority of them have been operating like robots. Receive money, bank, and give it out without putting into consideration the changing business world. Customers are constantly looking for businesses that are ‘human’, businesses that can listen to them and give them exactly what they need.

The coming of social media, despite the fact that it has made the lives of some banks a nightmare, is a big plus in terms of reaching out to both existing and prospect customers. Barclays Bank of Kenya has been voted among the banks that are most active in reaching out to customers and addressing their issues and concerns. In the recent study carried out by Soko Directory on the Top 10 Most Active Banks on Twitter, Barclays Bank was among the financial institutions that scored highly in responding to customers and clients promptly.

Innovation is key in enhancing the banking services in Kenya. Most banks in Kenya have invested heavily in innovation. Something to note is that Kenya has more than 20 mobile apps that specifically give them instant loans. Despite most of them having high-interest rates, Kenyans are increasingly abandoning traditional banks for loans to the mobile apps.

Barclays Bank is one of the lenders that has adapted to the changes with its Timiza App that allows both their customers and non-customers to access instant loans low-interest rates. With 1.4 million customers already using Timiza to process 40,000 loans per day, the App, not even one-year-old, is already on another level.

The app allows you to borrow loans of up to 150,000 shillings with a repayment period of 30 days. It also has comprehensive fees of 1.7 percent monthly fee, 5 percent processing fee, which translates to a total of 6.7 percent.

Customers can carry out various types of transactions using the app including the purchase of insurance coverage. One can get a personal accident cover of 100,000 shillings or a funeral cover of 40,000 shillings for as little as 42 shillings only.

Apart from allowing you to save, you can deposit money in the account and use it to pay utility bills. You can also send and receive money from other Timiza users.

Through Barclay’s partnership with Safaricom’s Little Cabs, you can use the app to secure easy transport and use it to pay for the service.

All these are available through the Timiza App and the bank’s aim of leveraging the strong internet presence and the desire to ease the process of acquiring certain products like health insurance covers