Digitization of SACCOs in Kenya as BankOne Expands Operations in the Country

When Pan-African fintech software provider, Appzone (AppzoneCore.com), relaunched its digital core banking solution for Africa’s fintechs and neobanks in October 2021, it was clear that the company would never waiver from its commitment towards accelerating economic prosperity in Africa through home-grown financial technology.

Four months since the company reengineered the platform with the functionality expected to drive exponential growth of fully digital offerings from new fintech across Africa, Appzone is expanding the operations of BankOne into East Africa, with Kenya as a destination.

On the 17^th of February 2022, Appzone strengthened its commitment to supporting the digitization of the financial ecosystem in Kenya as a strategic partner, hosting the first international workshop for Savings and Credit Cooperatives in Kenya (SACCOs), a cooperative movement ranked best in Africa and seventh-best globally.

Following an alarming surge in cyber security threats, insufficient support, unpleasant experiences from unreliable vendors, poor integrations, license constraints and overpriced digital banking systems that threaten the sustainability of the Savings and Credit Cooperatives in Kenya, Stakeholders are relying on BankOne’s core banking system by Appzone for a tried and tested internationally approved and top tier bank-grade digital banking solutions that will support the Sacco movement to advance to new disruptive heights.

Moving from good to great, the road to digital advancement for SACCO’s

On its own, the cooperative system in Kenya has done really amazing in terms of growth and asset base, the Customers despite being rural are currently transacting trillions annually, making up to approximately 5.55% of the country’s GDP. In terms of savings and assets, the cooperatives in Kenya have mobilized members’ savings and deposits in excess of Sh732 billion, featuring an asset base of approximately Sh1 trillion and a loan portfolio of Shs 700 billion.

Without a doubt the SACCOs, now numbering over 5,000 in Kenya, have shown a huge potential for growth over time, for instance, there are about 178 of them, taking deposits and about 158-back office Saccos doing above 100 million savings pool, while all others are below this threshold.

For Appzone the numbers in Kenya aren’t only convincing but certainly music to the ears and opens up a chance to move the market from good to great with BankOne’s core banking system as a reliable strategic partner.

As with Kenya and other parts of Africa, Currently, challenger and traditional banks are limited to using foreign technology solutions tailored for Western markets, or ERPs crudely customized for banking automation. These solutions are hindered by prohibitive pricing, poor market fit and a lack of local tech support and susceptibility to compromise (In the case of ERPs).

The target audience for Kenya’s Cooperative’s market sits predominantly within the rural catchment regions that deal with farmers, civil servants and merchants. They are not quite digital savvy and still conduct most of their operations manually. This is a gap, BankOne’s core banking system by Appzone will be looking to bridge, by providing the functionality that enables digital Banks to engage customers and deliver services without human interaction.

This essentially brings forth a digital equivalent of all product offerings including account opening, card issuance, deposits, payments, and loan origination amongst others for the institution, which is largely democratic, and member-driven.

Why BankOne is Built for Success

Originally launched in 2011, BankOne is delivered and run by Appzone Core (AppzoneCore.com), a company within the Appzone Group. The platform played a significant role in the first digitization phase of Nigeria’s financial sector and came to further prominence and adoption as digital challengers and neo-banks began to emerge. As Africa rapidly accelerates towards a fully digital banking future, it became imperative to better position BankOne to serve the continent’s growing number of Fintechs and neobanks.

Speaking on the Expansion of BankOne’s operations into Kenya, the CEO of Appzone Core, Mr. Mudiaga Umukoro said that the move is part of the company’s drive to digitise and fully automate the delivery of financial services across the continent

“For over a decade, BankOne has played an active role in driving the digitization of Nigeria’s financial services industry. Our expansion into the Kenyan market follows the identification of key gaps in the availability of proper applicable and affordable banking automation technology”

Speaking further about the event, the CCO of Appzone Core, Mrs Yvonne Ige stated “We strongly believe in the exciting prospects that abound in the financial ecosystem here, we are very committed to exposing (SACCOs) and the financial system here to an efficient and approved top tier bank-grade digital banking solutions that enable progress for everyone”.

Besides the digital capabilities that BankOne brings to the business and finance ecosystem, the overall progress and impact that it enables for financial inclusion is something to look forward to.

Covering Africa, one country after another

With operations in Nigeria, Ghana, Gambia, and now Kenya, BankOne currently host over 10 million customer accounts with balances totalling $105 million while managing over $650 Million in annual loan disbursements, and $2.9 Billion in total transaction value. Asides from managing customer records, loans, deposits, and accounting, BankOne provides an omnichannel self-service platform, USSD interfaces, Payment ecosystem integration, agent banking capabilities, and card management services. These functionalities are available to Fintechs like digital lenders and neobanks, as well as traditional banks like MFIs, Mortgage Banks, Consumer Lenders and Commercial Banks.

A significant value that the core banking system by Appzone brings to the finance and banking system in Kenya is that the Saccos, for instance, get an opportunity to move their banking operations from their customary ERPs to the globally renowned BankOne core banking system, with adequate exposure to global banking operation standards.

In the months and years to come, the over 5,000 Saccos in Kenya and other players in the country’s financial landscape will experience in a full scale, the ease of customization that the BankOne core platform brings, especially around how the platform seamlessly plugs into the needs of African Banks and Fintechs.