Co-op enters the cashless fare market
Gideon Muriuki, Group Managing Director, Co operative Bank of Kenya. Co-operative bank of Kenya has entered the cashless fare platform, becoming the latest lender to provide the platform in a bid to grow its non-funded income. PHOTO | FILE
What you need to know:
- Dubbed M-Nauli, co-operative bank said it will ride on its close association with the country’s Sacco movement to win over Matatu saccos.
- Mr Muriuki said that over 40 Matatu of these companies and Sacco’s have taken up the system such as City Shuttle, Double M and Forward Travellers.
- The listed lender hopes to ride on its customer base of 4.6 million accounts and network of 550 affiliated saccos to push uptake of the M-Nauli service.
Co-operative bank of Kenya has entered the cashless fare platform, becoming the latest lender to provide the platform as it targets to grow its non-funded income.
Dubbed M-Nauli, co-operative bank said it will ride on its close association with the country’s Sacco movement to win over Matatu saccos.
“We tapped into our experience with SACCOs when developing our M-Nauli system to ensure that the product effectively works for the Matatu Owners and as well as for customers." Managing Director Gideon Muriuki said during the launch.
The top tier lender is joining a field currently occupied by rivals Equity bank through BebaPay, Safaricom’s lipa na M-Pesa and a Matatu industry driven card dubbed 1963.
Kenya Commercial Bank also launched its cashless platform earlier in the month, underlining the growing appetite to tap into the multi-billion- day public transport sector.
SOURCE OF INCOME
According to data from the Traffic Licensing Board, there are approximately 22,000 licensed PSV operators in Kenya all operating under either a sacco or management company.
Mr Muriuki said that over 40 Matatu of these companies and Sacco’s have taken up the system such as City Shuttle, Double M and Forward Travellers.
The listed lender hopes to ride on its customer base of 4.6 million accounts and network of 550 affiliated saccos to push uptake of the M-Nauli service.
Owners of the public transport vehicles will be paying a commission based on every transaction, making the platform an attractive source of non-funded income for banks.
Speaking at the same event, Transport cabinet secretary Michael Kamau maintained that clearance of public transport service vehicles by the motor vehicle inspection unit shall be pegged on adoption to the cashless fare system.
"This is one of my Ministry’s efforts to reform the public transport sector and ease the matatu experience for Kenyans,” he said.
The transport ministry has had to severally postpone the deadline for compliance with the cashless system citing challenges in implementation of the system by public transport operators.
