Interswitch Group, has announced a partnership with Kenyan lender, Credit Bank, the International Fund for Agricultural Development (IFAD) and Ria Money Transfer.
The partnership will facilitate the provision of diaspora cash remittance services to rural recipients in Kenya through the Savings and Credit Cooperative Society (SACCOs).
According to the company, the program; tagged the Affordable Remittances and Enhanced Financial Inclusion Programme, the initiative will enable unbanked rural remittance receivers to access formal banking services through a basic and transparent bank account and see Interswitch and its partners collaboratively train and build capacity for over 1,350 SACCO members.
Credit Bank projects that during the initial phase of the programme, it will reach at least 1,200 Kenyans living in the diaspora and facilitate at least 1,500 rural recipients back home to open a bank account for the first time.
Thus far, the initiative has onboarded three SACCOs that will be engaged in the next 16 months, with projections to onboard seven more over the next 36 months. The SACCOs will have their staff appointed as sub-agents in the rural Kenyan areas which are currently underserved by formal remittance providers.
According to the Founder and GMD of Interswitch Group, Mitchell Elegbe, while speaking on the partnership, stated that the collaboration is indeed a significant stride towards bridging the financial divide, empowering more individuals and businesses in Kenya with access to modern payment solutions, and creating a more inclusive financial ecosystem for all.
He adds; “This partnership with Credit Bank of Kenya and IFAD marks an important step as we continue to expand our reach and provide innovative solutions for our customers worldwide. As we all know, remittance plays a crucial role in the lives of many people, and we are committed to making it simpler, faster, and more affordable,” he added.
According to Romana Rajput, the Country General Manager of Interswitch Kenya, “SACCOs form an important part of our financial services in Kenya where we come together to save money and improve the quality of our lives through lower interest rates loans to acquire important purchases like land, homes, educate our children, improve our businesses and much more. Working with SACCOs and their members will make transfers quicker and more convenient for beneficiaries.”
Diaspora remittances have grown in recent years to become Kenya’s biggest source of foreign exchange, largely driven by a growing number of Kenyan immigrants to Western economies such as the US, UK and Canada, and also a growing Kenyan migrant labour force in the Middle East.
Furthermore, diaspora remittances have an integral role in emerging economies like Kenya and with an estimated $4 billion sent back home each year, they present a crucial source for foreign exchange and capital flows into the Country, said Credit Bank CEO, Betty Korir, adding that “Initiatives like this will encourage Kenyans across the world to send money home while ensuring the largest possible portion of this money gets to rural recipients. The partnership will cut down the number of intermediaries to facilitate transfers directly to the last mile. We believe that we can take advantage of our wide SACCO networks within our rural communities to make remittances more accessible at the least cost.”
Conclusively, this collaboration, which will deepen financial inclusion efforts in Kenya, highlights Interswitch’s vision of a continent where payments are a seamless part of everyday life as the tech giant continues to leverage strategic partnerships of this nature to drive convenient value-exchange across borders.