Co-operative Bank eyes diaspora cash in money transfer deal with SimbaPay

SimbaPay chief executive Nyasinga Onyancha. PHOTO | EVANS HABIL |  NATION MEDIA GROUP

By OKUTTAH MARK, mokuttah@ke.nationmedia.com

In Summary

• The Co-operative Bank of Kenya has partnered with digital money transfer provider SimbaPay to offer international money transfer services to its customers in the United Kingdom, highlighting increased competition in diaspora banking.
• SimbaPay says it is able to offer the transactions for free since it will gain from the forex trades — converting foreign currency, including the British pound, into Kenya shilling.
• The service currently supports UK-Kenya transfers and there are plans to expand it to cover more countries in the near term.

The Co-operative Bank of Kenya has partnered with digital money transfer provider SimbaPay to offer international money transfer services to its customers in the United Kingdom, highlighting increased competition in diaspora banking.

To send money via SimbaPay, Kenyans living in the UK with a Co-op Bank account, can download the SimbaPay app from the Apple AppStore or Google Play and proceed to make cash transfers straight from any mobile phone, tablet or computer.

For ease of use, all the lender’s branches have been pre-loaded on to the SimbaPay platform which eliminates the need for customers having to remember branch codes.

“We are very pleased with our partnership with SimbaPay, which enables Kenyans abroad to send money home without suffering the cost of making the cash transfer,” said Maurice Matumo, director retail and business banking at Co-op Bank.

SimbaPay says it is able to offer the transactions for free since it will gain from the forex trades — converting foreign currency, including the British pound, into Kenya shilling.

At the time of making a money transfer transaction using SimbaPay, users/senders will be required to select the branch of the recipient account and then enter the amount.

In cases where a branch name is not known, the SimbaPay access to M-Pesa Pay Bill option can be used; this option requires only the Co-op Bank account number.

“Our customers who already bank with Cooperative Bank or have friends and family using Cooperative Bank will be glad to see their transfers being credited instantly,” said Nyasinga Onyancha, SimbaPay chief executive, in a statement.

The service currently supports UK-Kenya transfers and there are plans to expand it to cover more countries in the near term.

“We hope to expand this partnership to cover more regions of the world where Kenyans live and work, to enable the economy tap the full potential of diaspora, especially at this moment when the need for forex inflows has become critical,” Mr Matumo added.

Diaspora remittances stood at Sh102.7 billion in the eight months ended August, rising 8.7 per cent from Sh94.5 billion a year earlier.

Banks and other cash remittance firms earn substantial fees from the inflows, leading to increased competition for the global transactions.

For banks, handling the transfers has the additional benefit of providing them with deposits which is at the core of their lending business.

More banks have developed international money transfer and payment services, joining the traditional players including Western Union.

KCB Group, for instance, has come up with a mobile app for paying bills, making bank transfers globally and to M-Pesa worldwide.

Equity Group has an online multicurrency platform dubbed Equity Direct, with which it aims to grow its share of the UK-Kenya remittances. The bank runs the product in partnership with UK firm VFX Financial.

Family Bank has its Daima Mkenya brands which operate current and mortgage accounts for Kenyans living abroad while Ecobank has RapidTransfer, which targets intra-Africa cash flows