The Commercial Bank of Africa (CBA) has launched a new branch on Kirinyaga Road, a popular location for car spare part dealers and traders in a move to target the hugely untapped SME market worth an estimated Ksh. 807 trillion.
Jeremy Ngunze, CBA’s Chief Executive Officer, Kenya, speaking on the move said, “Our revamped proposition has entailed the opening of a new SME-only branch on Kirinyaga Road, introduction of new products to our SME portfolio, and the revision of our customer management strategy that enables us offer the required support to the dynamic sector.”
CBA, which is late to enter this market says each of the SME’s banking with CBA will be assigned a Relationship Manager, responsible for providing counsel and streamlining processes to ensure ease of banking. The firm also promised to have select branches open for longer hours to encourage banking.
Customers will also be introduced to 24/7 access through online and mobile banking platforms. CBA is targeting the suppliers and distributors of its corporate customers, traders and manufacturers who rake in millions of shillings daily but are largely under-banked. It also aims to serve the growing real estate sector, with a range of differentiated services that suit the dynamic SME customer needs.
Known for its Corporate and Retail market bias, CBA might struggle to serve SME’s and individual traders downtown due to a likely disconnect between the needs of the SME segment and the products offered by the bank. However, the firm is promising to leverage on the success in these categories to introduce discernible customer value propositions that will help SME’s with easily accessible, affordable and relevant services.
The bank has also introduced a real-data credit appraisal methodology reducing the loan processing period to two days and recently partnered with the Kenya Revenue Authority to launch the Common Cash Receipting System (CCRS) that makes it possible for business and individuals who import goods from other countries to pay the requisite taxes through CBA branches across the country, in a move that has been well received by SME’s.
Three out of every four people in gainful employment in Kenya, work in the SME sector which also contributes nearly 20% of Kenya’s GDP. Government statistics indicate that the sector is growing faster than other’s in the economy, and currently accounts for over 92% of all new jobs created annually.