Equity Bank to continue aiding Kenya's growth mission
This week, Equity Group Chief Executive Officer James Mwangi responds to your questions.
1. Equity Group Foundation has through the Wings to Fly scholarship programme helped thousands of bright but needy students access top-class tertiary education from some of the best universities abroad. Does your bank have a strategy to bring some of them home as we only hear of those taking up jobs in blue-chip companies abroad? Njeri Aseneka, Thika
The Wings to Fly is a phenomenal project that has given 16,168 bright kids but from humble backgrounds an opportunity to access secondary education through a comprehensive scholarship.
Eighty-four per cent of our scholars transit to both local and global universities. We now have 519 Equity Leadership Programme scholars admitted to Ivy League and other global universities.
We want them to be exposed to the best university education, get international social and work exposure, forge worldwide networks and then return home to develop our country. Some have come back and are working with various institutions.
We are very proud, for instance, with some of our Equity Leaders Programme (ELP Alumni) in the medical field who have come together under Equity Afia and their goal is to transform Kenya’s health sector.
Equity Afia is a health franchise network that seeks medical centres throughout the country that offer quality and affordable healthcare to Kenyans.
So far, the network has nine operational clinics having already attended to nearly 200,000 patients.
2. Sir, you served as the chair of the Vision 2030 Delivery Board. You once told us to get prepared to enjoy the fruits of a middle-income country, which you predicted was likely to overwhelm us. Are we there yet? Are better days ahead of us? Komen Moris, Eldoret
I have no doubt in my mind that if we continue having discipline in executing Vision 2030, we shall surpass the magical Gross National Income (GNI) of US$3,895 as Kenya joins the league of upper middle-income countries by 2030.
Kenyans are increasingly more educated, with adult literacy rate at 82 per cent and healthier with an average life expectancy of 66 years.
Investments in public infrastructure are bearing fruit in sectors like transport, energy and ICT.
3. In the current wave of acquisitions and mergers, it appears like Equity, KCB and Commercial Bank of Africa are only rushing to take over banks in financial crisis in and outside Kenya. In your own case, why have you not included micro-finance banks and Saccos, some of which are in serious liquidity issues? Dan Murugu, Nakuru
Equity’s strategic intent is to be in 15 countries across sub-Saharan Africa and support or bank 100 million Africans by 2024. Growth can either be organic through greenfield market entry like we did in South Sudan (2009), Rwanda (2011), Tanzania (2012) and Ethiopia (representative office, 2019) or inorganic via mergers and acquisitions of banks with similar social purpose, corporate governance and cultural fit, for instance Uganda (2008) and DR Congo (2015).
The Atlas Mara transaction that is currently underway is meant to acquire their banking subsidiaries to grow our market share in Tanzania and Rwanda as well as enter both Zambia and Mozambique as per our strategic plan.
DR Congo has a huge population of almost 90 million people and so we have decided to acquire another bank, Banque Commerciale du Congo, in addition to ProCredit Bank that we acquired in 2015 to be significantly relevant and have scale that will impact many lives and livelihoods in DRC.
4. Equity Bank has signed up to Sh30 billion for the Young Africa Works – Kenya initiative; the public private partnership between the government, Mastercard Foundation and the private sector. How do you plan to practically make these funds available to support the most deserving youth? Raphael Obonyo, Nairobi
The partnership with Mastercard is targeted at funding 163,000 entrepreneurs to create 830,000 jobs.
On the demand side, Equity Bank has offered its balance sheet, which is in excess of Sh650 billion, to finance MSMEs while Equity Group Foundation will provide capacity building entrepreneurship education and Business Development Services (BDS) to facilitate wealth and job creation by hundreds of thousands of Kenyan entrepreneurs.
On the supply side, this programme will work with TVET colleges to ensure youths gain world-class technical skills plus internship experience.
5. With regard to the recent allegations of customers losing their money, what strategy has the bank deployed to ensure affected customers are promptly compensated and to deal with the problem? Evans Juma
Most of the cases that have been reported of customers losing money has not been because of a breach of security in Equity’s banking system, but rather social engineering, which is targeted at financial institutions, mobile money and fintech customers.
As a bank we continuously inform, educate and train our customers to protect themselves, for instance, through campaigns like “PIN Yako Siri Yako’’ or “Kaa Chonjo” in collaboration with Kenya Bankers Association.
Customers are advised never to engage those callers and to report them to relevant authorities as well as always calling our official customer service lines or visit an Equity Branch to verify any information they receive.
We are working with the government agencies like DCI, Central Bank of Kenya’s Anti Bank Fraud Unit, other private sector partners as well as Global Security Operations Centres (GSOCs) to secure our customers and indeed the nation.
We continue to invest heavily in the most sophisticated anti-bank fraud detection and prevention systems, and we were indeed the first bank in East and Central Africa to be Payment Card Industry Data Security Standard (PCI DSS) certified for card and mobile payments.
6. Would you consider helping institutions in putting up science and computer laboratories plus equipping them in a phased approach across the counties? David Okello, Nairobi
Investment in STEM (Science, Technology, Engineering and Mathematics) is key if our motherland is to shift from a primary commodity exports to an innovation driven economy.
The government is scaling up infrastructure investments in public schools to support the new 2-6-3-3-3 Competence-Based Curriculum.
It is always preferable with limited resources to focus on a specific area for significant impact. We also use the bank to support commercially viable projects like education institutions.
7. You have assisted many through the Wings to Fly programme. But I have heard of a boy who was a beneficiary of the programme but became a drug addict while abroad and had to be hauled back to Kenya. What programmes do you have to keep these young people in line especially when they are in far off lands? Githuku Mungai, Nairobi
We always bring students in the US together during the Thanksgiving week for mentorship and coaching.
We encourage all students in the US and elsewhere to use the facilities in their respective learning institutions for support.
We have put up a structure to mentor, train and inspire the young people who join the programme through Annual Education and Leadership Congress.
This is the highlight of the leadership, mentorship and social transformation programme.
It also enables Wings to Fly scholars to interact with local and international leaders, while also strengthening their relationships with their mentors and Wings to Fly peers.
8 Can you consider reviewing Equitel EazzyLoans limits upwards? Githuku Mungai, Nairobi
Through Equitel’s EazzyLoans, customers can borrow anywhere between Sh100 to Sh3 million.
The digital loans are instant and devoid of any human intervention as they solely rely on algorithms calculated via data available to the bank. However, the loan limits vary from person to person as they are dependent on your credit history, sources of income, bank account activity, CRB rating, et cetera.
9. How can corporates sustainably uplift the standards at public universities? Teresiah Wangui, Kangema
Equity supports higher education sector via Equity Leadership Programme.
More than 14,000 KCSE top boys and top girls from each sub-county and Wings to Fly scholars who have scored “A” in KCSE exams have joined the Equity Leaders Programme.
From this, 5,963 have benefited from internships through the Equity Bank’s Paid Internship Programme.
We also offer corporate credit to universities to grow their infrastructure as per their strategic plans.
Corporates can engage robustly with universities via linkages to deepen impact via education, research and outreach as this is key in producing students with market-driven skills, changes in degree programmes to reflect market realities and research to drive business innovation and sophistication.
10. There is a case of one Muhia Mwangi of Equity Kangema branch who lost over Sh700,000 to con people. The bank management has declined to update the customer in the ongoing investigations. Where can such a customer seek help? Githinji Kahendu
Customers are advised to immediately notify our branches or head office by visiting, emailing or calling so that investigative and legal steps can be taken immediately.
Fraud is a criminal matter that requires the support of various arms of government like DCI, Central Bank of Kenya’s anti-bank fraud unit and intelligence services.
11 Refugees and internally displaced persons still largely remain unbanked. Why is this the case? Josiah Oduor, Dadaab
Equity is a financially inclusive institution committed to democratising access to financial services for all, including forcibly displaced persons — both refugees and internally displaced persons.
We have fully-fledged permanent bank branches in both Dadaab and Kakuma refugee camps, which host over 380,000 refugees.
We are a business for peace and have deployed the entire ICT infrastructure of the bank to deliver innovations like multi-partner, multi-wallet debit cards as well as a network of bank agents to serve both refugees and host communities.
12. I have been receiving dividend from some NSE company of Sh50, but every time that amount hits my account, Sh120 remittance fee is deducted, leaving me Sh70 poorer! Why are you charging fees for such little amounts? S. Kamau, Kiambu
This is a transaction-based service charge. Equity Bank is one of the most inclusive and customer centric financial institutions.
Customer surveys by third parties consistently show our transaction processing charges are the most affordable.
13. Every year banks declare super-normal profits when the economy is stuttering, and Kenyans burdened by loans. Are these huge profits a manifestation of greed or is there a substantive reason for the billions you declare? Benard Nyang’ondi, Mombasa
Banks don’t make abnormal profits, but their profits are related to their capital investments as per regulation and the risk taken as reflected by the size of the balance sheet of banks.
Kenya’s banking sector is highly competitive and depicts a perfect competition market with many suppliers and buyers.
The sector is comprised of many banks, deposit-taking microfinance banks, microfinance institutions, Saccos, telco mobile money wallets as well as FinTechs.
Sound banks globally underpin a stable financial system made of strong, innovative, resilient and well-capitalised institutions able to finance both small and huge projects by households, firms and government.