Co-op Bank and Super Group Deepen Leasing Partnership for Growth
The Co-operative Bank of Kenya together with South Africa’s leasing company Super Group, on June 4 affirmed their commitment to deepen the partnership in the local leasing business, through the joint venture firm owned by the two institutions named Co-op Bank Fleet Africa Leasing Limited.
The strategic partnership between Co-op Bank and Super Group is intended at penetrating and growing a modern leasing business.
It aims at market leadership, securing long-term partnerships and joint ventures to sustainably support growth, building on world-class competencies in the supply chain, fleet management, and dealerships, and providing customers with innovative leasing solutions.
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Co-op Bank Fleet Africa Leasing Limited, known in short as ‘’Co-op Bank Fleet’’ has within a short time since its establishment moved to stamp its presence in the leasing space, being a joint venture of two major players who bring to the table complementary capabilities in leasing.
Super Group of South Africa delivers its proven expertise in customer screening, product structuring, and risk management as Co-op Bank makes available its excellent client base to whom leasing is critical such as SMEs, Co-operatives and the Public Sector.
“Co-op Bank Fleet’’ already got off to a roaring start by concluding its first leasing deal worth over 890 million shillings in January 2019.
The maiden transaction, which is part of a larger 2.2 billion-shilling deal, entails the financing and delivery of a fleet of 125 vehicles to the Ministry of Interior.
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The Co-operative Bank was the financier, with Co-op Bank Fleet arranging the leasing in collaboration with motor vehicle dealers Isuzu East Africa Limited who are to deliver the fleet made up of trucks, pickups, and buses.
Super Group Limited is an established global leader in leasing business operating in three continents and is listed on the Johannesburg and Sydney stock exchanges.
“This partnership between Co-op Bank and Super Group continues to deliver mutual benefits as it taps the synergies created by the joint venture,” said Co-op Bank Group Managing Director and CEO Dr. Gideon Muriuki.
He also added that Co-op Bank Fleet enables the bank to better support customers to acquire the assets, technologies, and equipment they require at the same time enable the bank to diversify its income streams.
Leasing is gaining traction in Kenya with the government setting the pace notably by opting to re-tool, equip and modernize public institutions by way of leasing.
Experts say the availability of leasing implies that it does not make commercial sense any longer to buy assets to own, whereas you can hire to use them as and when you need them. And as the world progressively moves to Uber-style economic models that are asset-light, leasing can only grow, they add.
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Leasing is widely being seen as the most cost-effective model of acquiring business assets.
“Instead of spending all your money buying fixed assets, you can actually lease assets, you’ll be able to lease a lot more assets with the same amount of money,” Edna Kihara the Chairperson of the Leasing Association of Kenya was once said.
She also added that managing your cash flow is the next step in the business.
“The lump sum requirement for capital items when you are starting up a business, you don’t really require that. You can actually lease and then pay monthly or quarterly installments on the cost of that equipment,” she said.
Players say that opportuniti