Kenya Commercials Bank (KCB) Group on Thursday launched its Islamic Banking unit as it seeks to tap into the growing demand for Islamic financial products across the East African region.
KCB Group Chairman Ngeny Biwott said the move is aimed at tapping investments in the Islamic financial sector to help spur capital flows.
“This chapter is a milestone for our financial inclusion and deepening agenda for the banking and financial services sector to be accessed by everyone in the region,” said Biwott.
Biwott said the launch is part of the Bank’s long term vision to diversify its product offering while riding on technology as it reaches out to more citizens across the East African region and beyond who feel left out by the conventional banking system.
“Looking ahead into the next three years, this product will progressively facilitate development in the marginalized areas and deepen financial coverage,” he said.
In addition to the Kenyan operation, KCB Bank Tanzania is offering Islamic Banking services which is well supported with the regulatory framework that is in place.
The Islamic form of banking which targets both Muslims and non- Muslims has continued to gain traction globally with latest statistics from the World Bank indicating that global Shariah compliant financial assets have increased significantly over the past three decades, reaching about 1 trillion U.S. dollars in 2010 up from about 5 billion dollars in the late 1980s.
It is expected that Islamic banking assets will grow at a 19.7 percent over 2013-2018 to reach 1.6 trillion dollars by 2018. Currently, Sharia’h banking products account for 2 percent share of the market share in Kenya.
The KCB Group CEO Joshua Oigara said with everything in place, the Bank is ready to revolutionize the Islamic Banking space in the country.
“As a Bank, we are continuously looking for ways in which we can offer the best services to our customers,” Oigara said
For a start, KCB will roll out the Islamic Banking products in six of its branches in Nairobi, Mombasa, Lamu, Wajir and Garissa ahead of a national roll-out.
These satellite branches will serve as an operating model as the Bank seeks to enhance quality growth to create sustainable shareholder value. Enditem