KCB Group Ltd., Kenyaâs biggest bank by assets, is in talks with companies including Facebook Inc., Apple Inc. and Alibaba Group Holding Ltd. about collaborating on digital payments through its new financial-technology unit, Chief Executive Officer Joshua Oigara said.
The discussions, which are also being held with Alphabet Inc. and Tencent Holdings Ltd., form part of the lenderâs efforts to double the number of customers on its mobile-phone platform to 20 million by the end of 2017, Oigara said in an interview at his office in the capital, Nairobi, on Wednesday. The unit, known as KCB Fintech, will officially begin operations in June 2017, he said.
The subsidiary will âpartner with different players, whether it is M-Pesa, Facebook, Google, Apple and that business will have a new digital-payments platform,â he said. M-Pesa is the mobile-phone payments system pioneered by Vodafone Plc unit Safaricom Ltd., which handled 5.29 trillion shillings ($52 billion) of transactions last year, equivalent to more than 80 percent of the countryâs gross domestic product.
Banks in East Africaâs biggest economy are scrambling for market share in digital transactions with 25 million mobile-money subscribers spending 312 billion shillings ($3.1 billion) on goods and services in the three months through March, according to data compiled by the Communications Authority of Kenya. Lenders are seeking new sources of revenue after the government capped lending rates, pressuring margins.
KCB is doubling capacity on its mobile-phone systems so it can handle 600 transactions per second by next year, Oigara said. A surge in demand for loans caused the platform to collapse last week.
KCB is also in talks with Paypal Holdings Inc., Samsung Electronics Co. and Twitter Inc., Chief Digital Officer Edward Ndichu, who will head KCB Fintech, said in an interview.
âThis is the journey we are going through,â Ndichu said. âWe need to benchmark with the needs of the customer.â
Shares in KCB Group have fallen 38 percent this year to 27 shillings by close of Thursday trading in Nairobi.