24 March 2014

Kenya Banks Battle Against Mobile Cash

Nairobi — Banks in here been challenged to raise their game in customer experience or lose out a big chunk of their market to emerging banking platforms, a new study released last week in Nairobi concludes

Business advisory services firm Ernst & Young, said in their report 21% of Kenyans have already taken up alternative banking platforms as their primary financial services provider. This is above African and global average of six and two per cent, respectively.

'Banks in Kenya are facing increased competition from and mobile phone providers who are providing the customers with more options in banking and cash transfer than ever,' the EY global consumer banking survey 2014 states.

'Today's customers have more options than ever and do not view banks as having significant competitive advantage over newer types of banks and technology companies,' it continues in part.

A total of 502 bank customers in Kenya were interviewed in the survey titled 'Winning Through Customer Experience' that focused on 32,642 customers in 43 countries between July 25 and October 7, 2013.

Eighty-one per cent said banks should enhance personalised financial advice, compared to Nigeria's 75% and South Africa's 65% and global average stands at 74% and 61%, respectively.

EY's Regional Advisory Leader for East and Central Africa, Celestine Munda said, "A high percentage of Kenyan customers want banks to provide them with plans that will help them reach their financial goals and invest in their financial well-being."

Eighty-six per cent of Kenyans want access to financial experts compared to Africa's average of 78%. Kenyans also preferred customized products and services that fit their needs at lower costs.

The report recommends that banks should make banking simple and clear through transparency of fees, simplicity of offers and communication.

Other recommendations include building a wider channel to improve capability in problem solving and helping customers make right financial decisions. "Customers' experience is the main driver of trust and is also the single most common reason that they open and close accounts globally," London-based Steve Osei-Mensah, EY's advisory leader for financial services in East and Central Africa said.

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