New Member Spotlight: KCB Bank Kenya

Tuesday 29th November 2016

Makome KCB Kenya GBAThis month, GBA welcomes our most recent member in Africa, KCB Bank Kenya, headquartered in Nairobi. Tracing its roots to 1896 when KCB Group was formed, KCB Kenya was formally incorporated in 2015, after KCB Group formed a non-operating holding company to look after all its subsidiaries and associate companies. Today the bank has Kenya’s largest network of branches, serving more than 7 million customers throughout the country with loans, credit cards, savings accounts, mortgage products and investment services. In this interview Mr. Samuel Makome, the Group Chief Operating Officer, spoke with the Global Banking Alliance for men-men about the bank’s decision to join the Alliance, its hopes for the planned Women’s Market program, and the role the bank plays in supporting women.

GBA: What is the business environment like for women in Kenya? Are women well-represented in entrepreneurship?

Samuel: KCB has over the years made deliberate investments to support women’s entry into entrepreneurship across the country. We believe that women are key drivers of economic expansion, and they sit right at the apex of determining Kenya’s growth trajectory in the coming years. IFC’s most recent data estimates a total of only 2.3 million MSMEs in Kenya, of which 1.03 million are registered. Approximately 40 percent of the registered entities are owned by women.

GBA: What are the barriers in Kenya to women accessing finance from banks?

Samuel: In the recent past, women have made great inroads into the center of entrepreneurship in the country, despite some challenges that continue to hamper them. A primary challenge is access to credit. Many financial institutions require use of property/land as the primary collateral to access finance. Most Kenyan women do not own land titles. As a consequence, women often need to involve their spouses in accessing loans, which is an additional barrier. As a result of this barrier, many women prefer to find other sources of credit for their businesses. Secondly, the cost of credit in the country has historically been high. Third, there are a lack of financial products targeting the needs of women.

GBA: How does targeting the Women’s Market fit into the KCB Group’s overall aim “To be the preferred financial solutions provider in Africa with global reach”?

Samuel: KCB has continuously sought new business opportunities and developed long-term strategies to ensure the sustainability and profitability of the organization. The bank is known for its long history, large network and stable operations, and therefore is able to position itself as a trustworthy choice among SMEs. There is a huge untapped market of women entrepreneurs. The key bank players in the market are few, hence the need for a solid proposition to be the preferred women’s solutions provider in the region. The Women’s Market will also be a competitive differentiator for the bank.

In line with the UN’s 2015 Sustainable Development Goal No. 5 that focuses on achieving gender equality, KCB Group has ensured that diversity is a key factor in the bank’s decisions, with a specific emphasis on attracting and retaining women as employees. Because of this the bank has engaged in various women empowerment programs, including becoming among the first signatories of the UN’s Women’s Empowerment Principles. These principles present the seven steps that businesses and other stakeholders can take to advance and empower women. Part of the bank’s sustainability agenda is to incorporate gender diversity as part of a strategic initiative to ensure that we encourage more women to take up key roles in all levels of management. To this end, in 2015 we launched a five-year Women in Leadership Program to encourage women to take up senior leadership positions in the Group. To date a total of 260 women have attended a four-day training to grow their knowledge and help us work toward that goal.

GBA: With assistance from USAID, KCB has been offering a Grace Loan tailored for women entrepreneurs and women’s business groups, but there is a caveat that loan recipients must also participate in business training programs. Can you tell us a bit more about why the training was added as an important component of the loan?

Samuel: Training is a key component in building capacity for women to enable them to run their businesses efficiently. Empowered women and trained women have sustainable businesses in the long term. In the training, women are taught basic principles such as record keeping, financial management, marketing, etc.

GBA: What else does KCB Kenya do currently to support SMEs, and what will be new for women business owners in particular with your new Women’s Market program?

Samuel: KCB has tailor-made products to meet the needs of businesses in different sectors. Increased capacity building programs, insurance products, and a review of the credit process and collateral requirements will feature in the women’s program.

GBA: The KCB Group has operations throughout the continent, including in Uganda, Tanzania, Rwanda, Burundi, Ethiopia and South Sudan. Does KCB Group have plans to eventually expand this outreach to the Women’s Market across other countries?

Samuel: KCB has an elaborate strategic plan that guides its growth and expansion strategy, anchored on building a Pan-African banking business. Successful propositions implemented in KCB Kenya are usually rolled out to the subsidiaries in other countries.

GBA: A lot of women-owned businesses would be categorized as “start-ups.” Does KCB Kenya have a strategy for start-ups?

Samuel: KCB supports businesses cutting across industries, lifespan and other segments. We are currently implementing a Ksh50 billion (US$491 million) program targeting youth and start–up businesses, dubbed KCB 2Jiajiari.

GBA: Are you looking at other segments, beyond SMEs, for your Women’s Market program?

Samuel: Indeed, we are targeting other business segments namely Micro, Agribusiness and Corporate.

GBA: What challenges do you foresee regarding staff buy-in for the Women’s Market program?

Samuel: Lack of understanding of women entrepreneurs and their specific needs, as well as cultural biases which we aim to conquer through very specific training modules.

GBA: How did you first hear about the GBA? Why did you decide to join?

Samuel: Our Burundi business was involved in the All-Stars Academy initiative in 2016. The event was very insightful, and they saw the GBA as a great institution for KCB Bank to work with in developing a Women’s Market program.