NAIROBI, Kenya, Jul 12 – Post Bank has urged the government to hasten the process of restructuring it to allow the financial institution start giving credit directly to its customers.
The bank which has offered savings services to its customers for the last 100 years can only offer credit through partnerships with other commercial institutions and savings services.
The bank’s managing director Dr Nyambura Koigi hopes the process will be over by mid next year.
“The Cabinet has already approved that we be restructured, and the process is ongoing. We know right now the Cabinet is busy on other things and we hope to see it happening next year,” said Koigi.
She added that the financial sector is becoming dynamic and there is need for the customers to also start enjoying credit services.
“The intention is to allow us to give credit. We are doing agency banking, we are opening more branches and we are also agents of other banks. Right now we are offering savings, so we also need the other side of business which is credit, “she added.
She added that the restructuring would allow it to be able to come with new products and compete with other banks. The bank which was established in 1910 operates under the Kenya Post Office Savings Bank Act Cap 493B that limits it to savings products.
She was speaking during the launch of new savings product targeting the adolescent youth aged between 12 and 18 years. The product dubbed SMATA aims at promoting savings culture among the youth who are above 50 percent of the country’s population.
She added that, “to open and account, all one needs is Sh50 as minimum amount. This will make it accessible to a large pool of unbanked youth who are the majority.”
The bank has so far registered 2,000 new accounts under the new product and targets 70,000 by the end of the financial year.