Kenya’s Equity Bank is set to jump into the country’s mobile banking and money market this July – thanks to an MVNO deal struck with mobile operator Airtel.
The move brings the bank slap bang into competition with M-Pesa, the country’s dominant money service which is run by Safaricom, its largest operator.
And if the service proves popular in Kenya, then the bank is ambitious to deploy it elsewhere in East Africa.
The bank intends to shake up the market with its charging structure. P2P money transfers will be charged at one per cent of the transaction. The prevailing market rate is 16 per cent, claims Equity. And charges are capped at KES25 (30 US cents).
In addition, loans will be available for a maximum of two per cent per month interest. The typical rate is 7.5 per cent, it said.
In addition, users will be able to receive international remittance payments into their accounts, a service that is not available with M-Pesa.
Equity Bank was one of three MVNOs licensed in April to shake up the mobile money and payments market. All three are piggybacking on the network of Airtel.
Equity staff this week started to trial the MVNO service.
James Mwangi, CEO of Equity Bank (pictured), said the aim of the new service was to make financial services “convenient, accessible, affordable and inclusive.”
Users wanting Equity’s service will need to change the SIM in their handset to a new one issued by the bank.