This archive report was first published on 30 July 2019.
Published on July 30, 2019, a study by Infotrak has shown that innovations in banking have had the greatest impact on young and poor Kenyans.
According to the study, 58% of young Kenyans (18-34 years old) and 58% of poor Kenyans now use less of traditional banking products and services. This is a significant shift, with mobile channels being a key driver of this change.
"Youth and low-income households are the groups who have been highly affected by the usage of mobile financial service providers," said the "Changing Face of Banking" report. "Mobile channels are therefore a window to capture the traditionally financially excluded segments," it added.
Interestingly, the study found that the adoption rate for fintech services is low among well-to-do Kenyans, with only 46% of middle-income and 13% of high-income individuals using new avenues. Older Kenyans are also less likely to adopt fintech, with only 36% of those aged 35-49 years and 34% of those aged 50 years and above using mobile banking.
Despite the growing adoption of fintech, the study found that physical banking is still highly valued, with 80% of Kenyans preferring the traditional human model of customer service. In fact, 66% of Kenyans are likely to use physical branch outlets, while 78% are likely to use ATMs.
"Four in every five of banked Kenyans are more likely to use ATMs in future as about 3 quarters of banked Kenyans are likely to do over-the-counter transactions in future," said the report.
Insurance companies, on the other hand, rank as the least trusted financial service providers, with only 13% of Kenyans trusting them. Commercial banks, however, are highly trusted, with 94% of Coast residents, 90% of Eastern and Central residents, and 84% of Nairobi residents trusting them.
