EQUITY BANK

ALTERNATE DELIVERY CHANNELS

By Dr. James Mwangi,MD and CEO,Equity Bank Ltd, Kenya.Wednesday, September 19, 2007

KENYA DEMOGRAPHICS• Location: On the East African Coast astride the equator• Total Area: 582,650 sq Km• Capital City : Nairobi• Currency : Kenya shillings (KES)• Population: 34,707,817 • Population Density : 60%

38%

Informal

MFI’s & SACCO’s

BanksUn-banked

Male 91%Female 90%

EQUITY BANK LTD.

• A Public Listed Company at the Nairobi Stock Exchange.• A Leading Micro Finance Banking Africa.• Has Leveraged on ICT to offer innovative products & service to increase its outreach.• 65 Branches, 44 Village Mobile Bank Units, 200 ATM’s, 100 POS, 560 EFTPOS, e-Banking SMS Banking and m-Banking.• Customer Base in Year 2000 - 61,000 now 1.6 million.• Home to over 40% of Bank Accounts in Kenya.

Ratings and Ratings:

3rd Best Microfinance Bank in the World by Micro Capital – Sept’2007

April 2007

ALTERNATE DELIVERY CHANNELS

• Due to its large customer base, high volume of transactions and changing consumer needs Equity Bank aims to provide its customers with innovative financial products and growing its range of Alternate Delivery Channels:

200 ATM’s 350 ATM’s 100 POS 1200 POS 300 EFPOS 560 SMS Banking Mobile Banking Internet Banking Retail & Corporate

• The Bank has initiated setting-up a network of Agents to facilitate provision of financial services via the above channels and targets to recruit over 1,800 agents in the next three years

• More than 68% of Bank’s cash withdrawals transactions and enquiries are undertaken at ATM’s & EFTPOS Target 80%

Over 9 Million Potential Subscribers

}and Link to 3rd Party Networks

Agency Model

Digital Villages

Equity BANK

Super Markets

Fuel Stations

Kiosks

Whole Sellers

Prominent Retailers

Hospitals

Schools

Agents

Government Agencies

Provincial

Sub-Location

Sub-Location

Location

District

Sub-AgentsExternal Payment Networks

Other Banks

MOBILE PHONE BANKING• The Bank has been working on the mobile banking project,

which will go a long way in boosting the Banks’ alternate delivery channels other in addition to the traditional banking methods.

• In Dec 2006 Equity Bank launched the SMS component of it’s Mobile Phone Banking Service named Eazzy 24/7.

• As At 31 August, 2007 over 60,000 customers had subscribed to the service with over 500,000 transactions processed to date.

• In September 2007 The bank has launched the second component of the M-banking project. The service facilitates transactions via a USSD menu-driven mobile phone interface and a voice-activated (IVR) phone menu service on a VISA and Mastercard certified platform.

• The service is currently being piloted in a live environment with over 1,500 members of staff.

EAZZY 24/7 SERVICES

•Customer Notifications/Alerts•Customer DR/CR advices•Exchange rates Enquiries•Account Balance Enquiries•Airtime Purchase•Cheque book Request•Full statements requests •Mini Statement Enquiry•Stop Cheque Instructions•Bulk SMS to Customers

•Utility bills payment•Loan Repayment Notifications•Loan Approval Notifications•Funds Transfer•Person to person payments•Person to business payments•Business to person payments•Stop card instructions

BASAMKP1234MSSAMKP1234SASAMKP1234V100CASAMKP1234V100

Reply with the transaction you wish to perform

1 Banking2 Top up3 Bill Payments4 Pay an Eazzy 24/7 Agent5 PIN Change6 Stop a Card7 Request a Card

SMS

USSD & IVRReach the un-banked

Pay at a Supermarket

Challenges:• Remembering Message Formats, Acceptability, Recruitment & KYC, Access Charges & Demand for exclusivity by Telcos, • Handset Cost, Network Congestion, PIN not Masked, etc

Micro-Credit Services Under Consideration on all ABC

(insert the SMS banking poster)

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