NAIROBI, Kenya Feb 24 – The Treasury is calling for increased use of technology and innovation by financial institutions in an effort to increase formal financial access to a majority of Kenyans.
Speaking during the opening of the AITEC Banking & Mobile Money Conference, Finance Minister Uhuru Kenyatta said while the financial sector had made considerable effort in bridging the gap, a number of Kenyans still do not have access to finances.
Mr Kenyatta said through financial sector reforms, the government plans to increase financial access from the current 27 percent to 62 percent.
“Our financial sector is relatively advanced compared with countries in the region but the level of banking intermediation is still low compared to international standards,” Mr Kenyatta said.
The Finance Minister said use of innovation presents an ideal opportunity for the country to have a globally competitive banking industry.
He said while financial reforms were being undertaken to make services more accessible, players in the sector needed to be at the forefront of promoting innovation for their customers.
“Banks should broaden their awareness of products they could integrate into their systems which will be appreciated by the majority of customers,” he said.
The Central Bank of Kenya has been leading the way for making innovation a success in the banking industry. The CBK has already given the green light for mobile money transfer and mobile banking to blossom.
It has also taken steps to encourage financial institutions to open up their services to a wider reach by appointing retail stores such as supermarkets, chemists and postal outlets to conduct business on their behalf.
The 2009 Financial Access report, produced annually by Financial Deepening Sector Kenya, shows mobile phone money transfer services has helped push up the number of Kenyans sending money to 52 percent in 2009 compared to only 16.5 percent in 2006.
Mr Kenyatta expressed the government’s commitment to deepening financial sector reforms aimed at increasing access, improving efficiency and stability in the industry.
“We will leverage on theses reforms to strengthening the industry structure to facilitate transformation towards well capitalised banks capable of intermediating at high levels,” Mr Kenyatta said.
The two-day conference will bring together over 300 bankers, mobile operators, regulators and players in the financial service sector focusing on the COMESA region, giving participants a wider scope and market from east and southern Africa.
It will have 19 specialised sessions over the two days, with over 70 speakers from 14 countries. Session topics will range from ‘Compliance and risk management in the post-meltdown world’ to ‘Interbank payment reforms – new transaction and settlement systems’.