Co-op courts matatu saccos with M-Nauli

Co-operative Bank of Kenya managing director Gideon Muriuki holding a 'CEO of the year' award during an interview in his office on September 2, 2014. Coop Bank expects the 23 branches that made losses in 2014 to become profitable as cost-cutting measures initiated late last year start to bear fruit. PHOTO | DIANA NGILA |

By  RAMENYA GIBENDI

What you need to know:

  • Dubbed M-Nauli, the bank said it will ride on its close association with the country’s Sacco movement to win over matatu saccos.
  • According to data from the Traffic Licensing Board, there are about 22,000 licensed PSVs in Kenya all operating under either a sacco or a company.
  • Owners of public transport vehicles will be paying a commission based on every transaction, making the platform an attractive source of non-funded income for banks.

Co-operative Bank of Kenya has joined the league of firms providing cashless fare platform as it targets to rejuvenate its non-funded income stream.

Dubbed M-Nauli, the 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.

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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 early this month, underlining the growing appetite to tap into the multibillion public transport business.

According to data from the Traffic Licensing Board, there are about 22,000 licensed PSVs in Kenya all operating under either a sacco or a company.

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Mr Muriuki said that over 40 matatu companies and Sacco’s such as City Shuttle, Double M and Forward Travellers have taken up the system.

The lender hopes to ride on its customer base of 4.6 million accounts and network of 550 Saccos to push uptake of M-Nauli.

Owners of public transport vehicles will be paying a commission based on every transaction, making the platform an attractive source of non-funded income for banks.

Transport Cabinet secretary Michael Kamau said that clearance of public transport service vehicles by the motor vehicle inspection unit shall be pegged on adoption of cashless fare system.

“This is one of my ministry’s efforts to reform the public transport sector,” he said.

The ministry has had to postpone the deadline for compliance with the cashless system citing challenges in implementation of the system by transporters.

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