CBK approves Fingo Africa, first digital-only bank in Kenya
Fingo Africa has received regulatory approval from the Central Bank of Kenya (CBK) to roll out its services in the Kenyan market, setting it on course to become the first digital-only bank in the country.
The neobank is targeting to roll out digital banking services including opening an account, making withdrawals and deposits, checking bank balances, requesting bank statements and monitoring financial records.
“Fingo has partnered with Ecobank, the largest footprint bank in Africa, providing Fingo market access to Ecobank’s 33+ markets. Fingo and Ecobank are planning a pan-African roll out beginning in Kenya, where they are the first digital-only bank in the country,” the start-up says on its website.
Fingo was one of the African startups to be part of the Y-Combinator (YC), that raised a sizeable seed capital, valuing its business at more than $10 million (Sh1 billion at the time of valuation).
This comes at a time when digital banking services continue to grow, with Kenya’s traditional banks recording a rapid increase in digital banking transactions in recent years.
However, most of these traditional lenders are struggling to keep pace with the digital services required by customers, leading to disenfranchisement among customers.
For instance, a recent report shows, nearly half of customers’ requests in relation to bank services last year were not answered, keeping the majority of Kenyans from opening accounts with some lenders.
The Kenya Banking Sentiment Index 2022 by Deloitte and DataEQ shows that 47.1 per cent of queries on social media platform Twitter, such as signing up with the banks and the pricing of loans, went unanswered.
This comes amid increased use of social media platforms including Twitter and Facebook to engage with service providers and businesses.
“On average, only 52.9 per cent of service-related priority tweets received a public response. A possible reason for this poor responsiveness is the high ratio of non-priority to priority conversations on social media,” the report said.
Fingo argues its digital-only offering will help bring more youths into the banking system by making traditional banking services paperless and thus convenient.
“Youth in Africa struggle to access financial services, taking between 48 hours and two weeks to open an account, with multiple in-person interactions and requirements to bring physical paper documents,” said the firm.