11 June 2012

Uganda: We Offer Sh100,000 Loans


Fabian Kasi is the managing director of Centenary Bank. Samuel Sanya had a chat with him about the progress of the bank.

What percentage of Centenary Rural Development Bank (CERUDEB) is owned by the church?This bank has a Catholic foundation, and the Catholic Church owns currently owns over 70% of the equity of the bank. Currently the bank has capital of over sh140b and assets of close to sh1trillion.

Who are the bank's customers and what are your services?

The bank targets the ordinary Ugandans. People who want a good, affordable account where they can keep their money, safely, knowing that they can access it any time. People who want to borrow loans ranging from sh100,000 to sh3b. People who want to transfer money from one point to another and people who are interested in using other innovative means to do banking like telephone banking to carry out transactions for instance using mobile phones to make payments of bills.

How has CERUDEB's branch network grown over the years?

Over the last 25 years that the bank has been operating, we have been able to put up 53 branches and services points spread all over the country; all the way from Koboko to Kabale, and Kampala to Kitgum. We are planning to do more because the idea is to serve as many ordinary Ugandans as possible. This year, we will add another five branches to the network and going forward we will continue putting up many more service points to make it more convenient for our customers.

What impact has the growth of the branch network had on your business?

Centenary Bank has been positioned as the bank for the ordinary Ugandans especially those in the rural and peri-urban areas, because of that, the bank has been patronised by many people. Also because of the quality of service. So it has been inevitable that we had to put up a number of service points across the country currently, we have over 1.2 million customers and accounts. We have a third of the banking public in Uganda. We are giving loans to over 120,000 Ugandans and hopping to do more. We own a market share of about 10%, in as far as volume of deposits are concerned. The bank has capital of close to 140 billion, assets close to a trillion and giving loans above sh520b and deposits close to sh700b. Therefore, the impact is great. We thank our client and the banking public for patronising our bank.

What has made Centenary Bank the most attractive in the banking industry?

Our key selling point is affordability. The other, is a wide range of products like; salary, business, agricultural loans. For instance, 17% of our loan portfolio is going to agriculture as opposed to the 6 per cent of the banking industry. So for agriculturalists, this has been and is the bank to choose. Our bank is unique in that sense.

What is the bank's 5 to 10 year strategy?

As our mission stipulates, we want to remain the biggest micro finance bank in Uganda serving the biggest number of clients in this country. Last year we made a profit of sh49b and most of that money is reinvested in the bank.

Why does Centenary Bank continue to position itself as micro finance bank?

When we talk about micro finance services, we are talking about small loans, ranging from sh100,000. Not many banks in this market can offer that kind of loan to customers but Centenary bank can.Micro finance loans at the end of the day, turnout to be very good solutions to macro economic problems although they are under looked.

What challenges has Centenary Bank endured to be the leading  micro finance bank in Uganda to date?

Micro finance being a low value, high volume transactions, it faces a lot of challenges, especially, with the cost of operations. So to manage these, you ought to have invested a lot in human resource and technology. Centenary has gained a lot of experience over the last 25 years in improving microfi nance services and that's why we continue to serve our clients. It is because of the dedication of the staff that this bank has achieved what it is. We will continue to do what we are expected to do. Accountability will continue to be key when it comes to executing our duties to take this bank to next level.

What have been the key success factors for Centenary over the years?

First and foremost, we are blessed with a number of loyal customers and we are thankful for their continued support. Staff have been very critical to the success of the bank because it is important to have the human resource which can offer the services you promise. Equally important, the Catholic Church, the majority owners of the bank, who have financed the bank's growth over the years. The church has also been instrumental in ensuring that it imparts the right values that our staff needs to accomplish their duties.

Our success is also attributable to strategic partnerships. The church was founded on partnership and along the way, we have had partners like the World Bank which is helping us to finance agriculture and also build a robust banking system that can enable us to serve more people in need of agriculture services. At the regulatory level, the Bank of Uganda, the central bank has been our strong partner.

It has been guiding us and creating for us an enabling environment for us to grow to what we are today. Like all the other banks, we don't work in isolation but in collaboration, therefore, our success has also come from great cooperation with our peers.

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