Kenya’s Kwara Launches Digital Banking Platform for SACCOs

Kenya’s Kwara Launches Digital Banking Platform for SACCOs

Savings and Credit Cooperative Organisations (SACCOs) have been hard hit by the Coronavirus pandemic over the last few months. Kwara offers them the opportunity to come on board its banking platform, and provide uninterrupted services to their customers as the world battles to return to the status quo.

Kwara launched its services in Kenya in 2018 to provide safe and secure digital banking to SACCOs. It is no stranger to working with savings and cooperative societies in Kenya. Since its inception, Kwara has grown to reach over twenty-seven thousand members of savings and cooperative societies through the cooperative societies themselves. It manages over Kshs. 8 billion in assets.

Kenya has seen the number of SACCOs continue to rise, offering invaluable services to millions of citizens. Quite unlike the modern banking sector, SACCOs have had to depend on face-to-face interactions to grow their network. Only about 5,000 of Kenya’s over 14,000 registered cooperatives offer saving services to their customers. With an asset base of 300,000,000,000 Kenyan shillings, offering savings services that have pooled in about Kshs. 400 billion in domestic savings, cooperative societies are an important part of the economy. 

The recent spate of various forms of restrictions and total lockdowns across the globe has disrupted global economic activities. In Kenya, the case has been the same as the directives from the government have not allowed savings and cooperative societies to be able to easily sign off on loans as well as regular deposit and withdrawal requests they have come to be known for – services that have seen them grow to control 33% of Kenya’s total savings. 

With about 63% of Kenya’s population reliant on the services of SACCOs directly or indirectly, we can all agree that they need to take that big step into the digital banking space to surmount these challenges because no one knows the day things will return to the way they used to be, or if they ever will.

With its latest product, Pronto, Kwara is giving cooperative societies access to the nucleus of their digital banking platform. Cooperative societies will be able to offer online services to their customers, using the platform to transact business, receive loan requests, and process them while complying with the government’s social-distancing directives. SACCOs will be able to do this free of all costs for three months.

Kwara CEO and Co-founder, Cynthia Wandia had this to say about their new product: “Traditionally SACCOs rely on face to face interaction to serve their customers. Today they are facing significant challenges trying to operate in this new environment. Our platform is designed to kickstart their digital transformation, and we are offering an essential version of our platform for free, to do our part in ensuring SACCOs can continue serving members that need them and get through these difficult times.”

Kwara’s activities are bankrolled by Google for Startups, Catalyst Fund, Bonum Ventures, and Finparx. The first 50 cooperative societies who qualify will have the opportunity to run regular over-the-counter services to their customers online using PRONTO. They will receive deposits, loan requests, and easily process withdrawals for their customers, offering them an edge over the others who cannot do so. 

Backend banking activities can be done remotely by staff, with the platform geared to allow for processing of more requests from customers. Ease of dissemination of documents using the backend of PRONTO will help to centralise information amongst employers regardless of having to observe social distancing measures.

The SACCOs who get this opportunity will most likely see their competitors’ customers do business with them if their competitors cannot find a way to meet the banking needs of their customers amidst the social distancing guidelines.