Financial services provider Equity Bank Limited, with headquarters in Nairobi, Kenya, has become in a great way a key case study in many management schools throughout the world. Equity’s business model has been a valuable study resource for learners. To understand more about the brand, business schools, organizations, and institutions frequently visit the Group. International financial institutions from all around the world visit for benchmarking exposure.
Its somehow casual approach to simplify customers’ access has won big where normal banks never saw an opportunity. The closest rival to equity bank is, as per my opinion, M-Pesa Mobile Banking, by Safaricom. Safaricom Limited is a leading telecommunication company in Kenya, providing voice, data, and financial (mobile money) products and services. According to M-Pesa mobile money services, one only needs to have a registered mobile phone line. In other words, if you have an identity card, you can register a line and you can activate your M-Pesa Account using any mobile phone device. This is done by following a process on a menu, which is available on the sim card, and it ensures your security codes work for you. After that, you are good to do deposits, payments, and withdrawals. The whole process sounds easy to start and is easy to maintain since you are not charged maintenance fees.
When Equity Bank began its services in Kenya, it was just like any other private banks around and though the bank had been in operation for some time, I noticed Equity slightly after the year 2004. Its new offers sounded too unofficial, only likened it to some pyramid scheme that will sink (of course with people’s money!). At this time, some pyramid schemes had already sunk with people’s cash. To open an account with this bank, one only needed a copy of national identity card! No deposits were required whatsoever, except some amount for an ATM card, which was not a must to take and most affordable, if you need it. The Bank rolled out branches where others thought it was not safe and welcomed all that wanted just an account; with or without money! What followed were excessively long queues inside these banking halls.
Mobile money transfer technology by Safaricom was a considerable success and excluding it would be a big mistake in the Kenyan banking industry. The Bank will not be beaten while seated. Its collaboration to adapt to challenges had it collaborated with banking technologies. In order to provide financial services to more people, Equity Bank created the Equitel brand to offer Mobile Virtual Network Operator banking. This implies that if you purchase an Equitel sim card, you are linked to an actual bank account by Equity Bank, the only bank in Africa that provides MVNO banking services. As many people were already mobile phone owners by then, one had only to purchase the sim card, which was thin such that it was laid over the other normal one and the phone was good to access both cards. This technology was, however, challenged for security reasons but passed the test.