Kenya Institute of Bankers (KIB) acting Chief Executive Officer Dr. James Wanjagi has shed light on some of the challenges facing Digital Banking in Kenya as well as possible solutions to these problems.
While speaking during an interview with The Kenya Times, Dr. Wanjagi explained a number of these challenges Digital Banking just like fintech face.
He mentioned lack of infrastructure as the first challenge, saying that as banks move towards digital banking, and fintech’s try to penetrate the space, there is need for reliable internet and electricity. He talked about the last mile that is part of vision 2030, saying it is still not a reality, thus, trying to bring in the unbanked from rural arears with no internet and electricity to embrace formal banking and some of the fintech services and products is impossible until the issue of infrastructure is sorted out.
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Dr. Wanjagi said the other challenge was lack of policies. He talked about Kenya not having regulatory conversations around policies that are conducive to fintech.
Moreover, the KIB boss noted that lack of funding limits developers from coming up with fintech solutions in the industry. Dr. Wanjagi said most people do not have the start-up capital to go past the planning process of their fintech solutions, adding that there is need to have a government avenue or venture capitalist in place to get proper funding.
Nonetheless, he called for collaborative conversations across different players in the digital banking sector including banks, fintech and telcos. According to the KIB boss, such conversations will go a long way in improving the digital baking sector.
The KIB boss also stressed that technology is the future of banking, adding that fintech solutions allow customers access services at their convenience and at reduced costs.
When asked whether he sees financial institutions completely shifting from traditional banking model to the digital banking model, Dr. Wanjagi said there is still space for traditional banking services as people still value human interaction. As such, he stated that there may still be some type of continued form of contact between bankers and their customers.
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According to Wanjagi, there will be a shift rather than a complete closure of the traditional banking model.
Dr. James Wanjagi was one of the key speakers during the World Financial Innovation Series (WFIS) 2023 held at the Kenyatta International Convention Center (KICC) in Nairobi, Kenya.
He talked about comprehending the digital transformation of the Financial Service Industry (FSI) in Africa.
Furthermore, the KIB boss led a discussion on the key players in the FSI ecosystem, digital banking and financial inclusion, digital banking, and SME’s as well as the challenges that must be addressed in the industry.
