Absa Bank Kenya has unveiled an ambitious plan to significantly expand its agency services network, with the aim of establishing over 17,000 outlets across the country within the next two years. This move marks a strategic effort by the bank to broaden its reach, enhance financial inclusion, and meet the evolving needs of its diverse customer base.
Currently, Absa operates 600 agency outlets. However, the first phase of this expansion will see the bank rapidly increase this number to over 3,000, with a focus on enhancing its presence in underserved areas. This expansion is designed to offer both existing and potential customers greater accessibility to essential financial services, including cash deposits, withdrawals, and other transactions, all facilitated through third-party outlets such as general shops and convenience stores.
The decision to expand the agency network is aligned with Absa’s long-term growth and financial inclusion objectives. It also underscores the bank’s commitment to its new customer-centric brand promise, “Your Story Matters.” By leveraging a third-party network, Absa aims to bridge the gap for communities that have historically been underserved by traditional banking channels, ensuring that more individuals and businesses can access crucial financial services within their localities.
Absa Bank Kenya’s Managing Director and CEO, Abdi Mohamed, emphasized the bank’s commitment to supporting its customers’ growth stories through innovation and solutions that cater to their daily financial needs. He noted that as a full-service bank, Absa serves a wide range of clients, from those who prefer digital interactions to those who value the personal touch of in-branch services or third-party interactions. “We are a bank for all seasons,” Mohamed stated, highlighting the bank’s adaptability to the evolving financial landscape.
Mohamed also pointed out that the agency network is a critical component of how Absa serves its customers. “Our footprint will continue to grow over time, and we are focused on demystifying banking for all,” he added. The expansion of the agency network is seen as a vital distribution model that will not only drive efficiency in the bank’s operations but also contribute to the overall growth of Kenya’s economy by facilitating essential financial services in areas that have been traditionally underserved.
This expansion initiative is consistent with the growing preference among customers for alternative banking channels. The convenience offered by the agency banking model has made it increasingly popular, particularly in a market where access to traditional banking services can be limited by geographical and logistical challenges.
The Central Bank of Kenya’s Annual Report for the financial year 2022/23 supports this trend, noting a significant increase in banking transactions conducted through agents. As of June 2023, there were 21 commercial banks and three microfinance banks engaged in agency banking, with a total of 85,328 and 936 active agents, respectively. Since the introduction of the agency model in 2010, the number of transactions has grown substantially, reaching 1.3 billion in June 2023, up from 1.1 billion in June 2022.
The value of these transactions also saw a marked increase, rising from Kes 9.0 trillion to Kes 10.8 trillion over the same period. This growth underscores the increasing reliance on agency banking services as a convenient and accessible alternative to traditional banking methods.
Absa’s expansion of its agency network is expected to further accelerate this trend, providing more Kenyans with the opportunity to access banking services that were previously out of reach. By focusing on enhancing service delivery to the last mile, Absa is positioning itself as a key player in the ongoing effort to achieve greater financial inclusion in Kenya. The bank’s strategic expansion is not only a response to current market demands but also a proactive step towards shaping the future of banking in the country.
