CBA (Commercial Bank of Africa) and Safaricom Limited have introduced a fixed deposit feature on their M-Shwari platform called the “Lock Savings Account”, a facility which will allow Kenyans an opportunity to save for a specific purpose.
This is aimed at enforcing a saving culture in Kenya, a country where savings fall below 20% of the GDP, making it effectively the lowest in the region. M-Shwari is a Safaricom service that allows Safaricom M-PESA customers to save as little as 1 KES in an interest generating account and get a loan worth between 100 KES and 50,000 KES after a certain period.
To access the ‘Lock Savings Account feature’, customers will need to dial *234*6 and follow the prompt.
This service allows customers to save a minimum of 500 bob for a maximum of 6 months at interest rates of up to 6% p.a similar to what is given by saccos only this time, the lower limit is at 500 KES.
Some Facts About M-Shwari:
M-Shwari has seen CBA’s loan accounts grow by more than 800% from 89,000 in 2012 to 897,000 in December 2013 making CBA Kenya’s top retail lender. M-Shwari has over 7 Million customers who have in the last 2 years transacted more than KES 156 Billion and taken out loans worth KES 13 Billion.
Betty Mwangi-Thuo, Safaricom’s General Manager of Financial Services affirms that Central Bank of Kenya has been credited with growing the segment of the country’s bankable population that has access to a bank account to 67%.
A replica service launched in Tanzania by CBA and Vodacom dubbed M-Pawa, has registered 250,000 customers in the first 3 weeks since public availability.