Kenya’s Equity Bank’s diaspora remittance volumes to 100 billion shillings (979 million dollars) in September, boosting the lender’s forex trading income to 2.84 billion shillings ($19 million dollars) during the period.
The volume grew by 28 percent between January and September 2019, compared to the same period in 2018 – when the bank handled 79.8 billion shillings (790 million dollars). This means that it is now on track to account for the equivalent of over half the remittances coming into the country.
Equity Group CEO, Dr James Mwangi, said the lender is leveraging on its fintech partnerships to drive the volume of remittances it is handling.
The direct commissions earned from handling the remittances stood at 602 million shillings (5.8 million dollars), having grown by eight percent from 557 million shillings (5.4 million dollars) in the same duration in 2018.
“Commissions are not the focus but rather the focus is access to foreign exchange. What we have seen is that when it comes to our forex dealing, we are overcompensated because 25 percent of all the forex that we deal with is coming from the remittances, giving us an assured source that is helping us become one of the biggest players in trade finance,” said Mwangi at Equity’s quarter three investor briefing in Nairobi.
Overall, Kenya’s diaspora remittance, as per Central Bank of Kenya (CBK) data, stood at 215.6 billion shillings (2.1 billion dollars) in the nine months to September 2019, an increase of 4.4 percent from the equivalent period in 2018.
In the past, CBK Governor, Patrick Njoroge, has attributed the growth in remittances to better transmission channels as more banks make use of fintech to facilitate the inward movement of the cash.
Equity reported a 12 percent growth in the net profit to 17.46 billion shillings (166 million dollars) in the nine months to September, helped by higher interest and non-interest income.
Equity Bank has branches in Rwanda, South Sudan, Tanzania, Uganda and DRC.