Commercial Bank of Africa (CBA Group) has launched a mobile phone-based banking service targeting millennial entrepreneurs.
The new service dubbed “CBA Loop”, launched under the tagline “Unbank Yourself”, also seeks to capture tech-savvy individuals looking for a banking experience devoid of the bureaucracy, duration and paper work associated with traditional banking.
It eliminates the need for visiting a physical branch for any of the core banking services as they will now be available on a mobile phone app that was unveiled at the Kenya Cultural Centre in Nairobi Monday.
CBA Executive Director Martin Mugambi called it a truly digital bank, noting that it is the culmination of the bank’s technology driven ventures that started with the launch of mobile payments through Safaricom’s M-Pesa in 2006 and its own M-Shwari six years later.
He said the launch of Loop marks the transition to CBA 2.0 that seeks to embrace the future.
“The future starts today, right here,” he said.
By targeting millenials with the new Loop product, CBA is eyeing a big chuck of the youth aged between 20 and 34 years, who constitute 70 per cent of the Kenyan population. These are those who are tertiary educated, live in major towns, are economically engaged with regular income and are seeking instant gratification and recognition. They also love a sense of belonging and always look to form groups and more in packs. In addition, they love multi-tasking and can juggle many responsibilities at once and have access to the internet, electricity and permanent roads. Most of them have side jobs/hustles in addition to formal employment.
But CBA also has a secondary target – those aged between 35 years and above, whose only other difference with those aged between 20 and 34 is that they have existing banking relationships that are entrenched.
Unlike other mobile banking apps, Loop has a wide range of transactional features that streamline how customers save and make investments.
Customers will also be able to use the app to manage their personal finances, schedule their utility bills payments, send money, access loans and pay for goods and services at retail outlets.
While traditional banks have effectively catered for its more established customers, it has fallen short in addressing the needs and preferences of millenials and especially the new age entrepreneurs.
During panel discussions at the launch, it emerged that most young entrepreneurs are having difficulties accessing credit as they do not have security.
In addition, the paper work is tedious and some of the ventures they are involved in are considered risky.
CBA says said the new product is in response to research that delved into the target customers’ habits, motivations, aspirations, preferences, passions, as well as their pain points in accessing banking services such as loans, deposits and making savings.
CBA General Manager, New Business Ventures Eric Muriuki said the new Loop service breaks down the bullet proof glass between the customer and the bank. “Loop promises you the customer that you will achieve your goals faster and with more certainty with CBA,” he told entrepreneurs who attended the unveiling of the new service.
ICT Cabinet Secretary Joe Mucheru, who was the guest of honour, said the government will work to protect investment in innovations. Mucheru said various initiatives are in place to ensure the youth get employment in the online space. Security agencies are also on alert to guard against criminal elements fraudulently exploiting the internet, he said, citing the recent case of hacking that affected the Kenya Revenue Authority and banks, among others.
In addition to the banking app, CBA also announced the opening of six Loop Stores in Nairobi where customers can collect their cards after registering online on www.cbaloop.com
or by downloading the App from Android or iOS App Store. The retail stores, located within the CBD, Garden City Mall, The Point Mall in Buruburu, Maasai Mall in Rongai, Yaya Centre and Village Market, are equipped with wi-fi and are designed as both work and social places where customers can meet and share their experiences with financial partners or among themselves. More will be set up in other parts of the country.
South African based global business speaker Vuzi Thembekwayo was the keynote speaker at the function.