A Co-operative Bank outlet in Nairobi. PHOTO | FILE
By CHARLES MWANIKI, cmwaniki@ke.nationmedia.com
In Summary
- A growing number of Kenyans are working in the Middle East, making it one of the new frontiers in the competition for remittances revenues among local banks.
- According to Ms Wachira, Co-operative Bank handled about 20 per cent of the total national remittances of Sh154 billion last year, translating to Sh30 billion.
Co-operative Bank
has partnered with Gulf-based remittances firm UAE Exchange that will
allow Kenyans in the UAE to send cash into own accounts at the bank.
Under the partnership which kicked off at the end of last
year, UAE Exchange will remit money into accounts held at Co-op Bank,
with the lender in turn offering them bank accounts and investment
options.
UAE Exchange has opened an office in Nairobi to
handle the remittances. The firm has a presence in 32 countries across
the globe, with more than 800 offices.
Co-op Bank has at the same time opened a 24-hour Diaspora Centre at the headquarters to serve Kenyans abroad.
A growing number of Kenyans are working in the
Middle East, making it one of the new frontiers in the competition for
remittances revenues among local banks.
Customer accounts
“They (UAE Exchange) recently launched a product where they will be sending money from the UAE to Kenya for Kenyans. We want to be their settling bank and for them to be crediting funds into our customer accounts,” said Co-op Bank head of diaspora banking Milka Wachira.
“They (UAE Exchange) recently launched a product where they will be sending money from the UAE to Kenya for Kenyans. We want to be their settling bank and for them to be crediting funds into our customer accounts,” said Co-op Bank head of diaspora banking Milka Wachira.
“The initial scope of the partnership is for them
to be able to credit our customer accounts but we will expand it and
introduce other aspects soon.”
According to Ms Wachira, Co-operative Bank handled
about 20 per cent of the total national remittances of Sh154 billion
last year, translating to Sh30 billion.
“We have seen a trend whereby our customers are
shifting towards a culture of remitting money and keeping it here as
savings. Ours is to provide the remittance channel, while Co-operative
Bank will handle the investment bit for them,” said UAE Exchange head of
Africa Unni Krishnan.
“We will also be able to enable the customer open
an account where they are in the UAE. We have already hired some Kenyan
staff to man some of our offices in UAE, Qatar and other Gulf countries
to handle this.”
Local banks have become more aggressive and
competitive in tapping the remittance business from the diaspora,
because it provides them with cheap source of deposits, foreign currency
and earns them transactional income.
Highest in Africa
Inward cash remittances rose 9.3 per cent last year to Sh154 billion from Sh141 billion in 2014 as per CBK data.
A World Bank report on remittances and immigration
for 2015 listed Kenya as the joint third highest recipient of
remittances in Africa alongside Senegal, and only behind Nigeria’s $20
billion (Sh2 trillion) and Ghana’s $2 billion (Sh200 billion)
Inward cash remittances rose 9.3 per cent last year to Sh154 billion from Sh141 billion in 2014 as per CBK data.
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