Equity Bank Group

Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

Youth Banking

……..The current, unprecedented level of global youth unemployment has raised the risk of creating "a lost

generation,“………

Nemat Shafik, deputy managing director of the International Monetary Fund

(15th March 2012)

Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

“…I do not know about banks, I cannot pass in front of the bank because of

how I look”.

Youth in Kenya

Equity Bank Market Research Report - 2011

Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

East Africa Statistics

5 East African countriesPopulation of about 135 Million Estimated number of youths (below 24) –

87M (65%) Uganda leading with 70%Population below poverty line – 50%Youths with savings accounts – 13%Mobile phone penetration (2010) 411/1000

– growth of 378% between 2005-2010About 75% of the 40% unemployed is

made up of the youth

Mobile Phone Penetration

Country 2005 2008 2010

Penetration growth 2005 - 2010

Tanzania 86 320 360 319%

Kenya 152 361 521 243%

Rwanda 49 250 360 635%

Uganda 57 289 404 609%

Totals 86 305 411 378%

Equity Challenge

Item (Approx. 135M)

Equity Bank (Approx. 7M)

Gap to Coverage

Below 30 years

73% 36% +37%

30-40 years 13% 30% -17%

40-50 years 6% 18% -12%

Above 50 years

8% 16% -8%

Drivers of Youth Innovation- Equity Bank Group

Demographics Changes in customer base composition (youth bulge/demographic dividends, sophistication and dynamism requires banks to focus on differentiation. 24/7 availability of banking services

Technology Youth affinity for technology-based solutions, the social media as an integral platform, technology convergence (e-commerce & m-commerce)

Equity Banking Model Huge volume vs small margin making EBL ‘cheap’ as compared to competition, cut operational costs, financial inclusivity vis avis youth population, managing business model disruptive technologies given banking/telco convergence

Drivers of Youth Innovation- Equity Bank Group

Cut-Throat CompetitionTraditional vs. Contemporary competition – Demand for choice, Telco-Banking convergence, banks downscaling to microfinance, micro finance up-scaling to banks

Globalization Universality of the Youth. Youth dynamism, youth-friendly service points like agent banking , mobile solutions & POS at merchants that ensures service access 24/7

Availability of ‘cheap’ but appropriate technology ubiquitous nature of mobile application technology,

ICT innovations to support Youth Banking - Equity Bank Group

Mobile phone driven TransactionsUtility payments- electricity payments, water

payments, school fees payments, Un-denominated Air time top ups (buying what you can afford) direct top up from your account

Temporary overdrafts- temporary overdrafts against remittances for emergencies

Specialized Loans for the youth in ICT investments In conjunction with local universities and telcos; funding of laptop acquisitions (empowering youth to create applications that can be commercialized)

ICT innovations to support Youth Banking - Equity Bank Group

Youth mobilization into the formal financial spaceTraditional and contemporary group approach – financial deepening, inclusivity

ICT innovation CentersEnabling innovation through incubation. The bank is in the process of opening the 1st innovation center targeting youths with creative ideas that can be packaged into commercial ventures

Youth Inclusion- Digital Natives: What they Want

11

EBL Proposition Online, real time 24/7

Keep clients plugged-in ubiquitous

Self-Service channels Boost uptake (viral) Reduce costs & time Convenience ‘un-traditional’ /hip/cool

High security Bio, PIN, alerts etc

=

What dig. natives want? Online 24/7

Obtain & use it right now

Self-Service channels Make it easy (simplicity) Save time Save money Experience (the Wow factor!)

High security Control my risks

Youth Inclusion Digital Natives Engagement

Strategy

TransactionsTransactions

Sophisticated Sophisticated Financial ServicesFinancial Services

Transaction Technology (NFC, Mobile Apps, etc.)

Micro-InsuranceSavings

Investments – wealth creation

Loans- funding innovation & Entrepreneurship

Retail & Micro- Payments

P2P Transfers

Cash withdrawal & Cash deposits

Online payments & transfers

CHANNELSCHANNELS

The ultimate offering

Introducing the Equity solution14

“Including and expanding”

Re-building the foundation for a bank that truly

serves all Young Africans

PURPOSEVISIONMISSION

Daily relevance Un-cashed Many services Universal“Ubiquitous Financial Partner”

Simple Accessible Mass market “The new banking hygiene factors”

Service Respect“The Equity secret sauce”

Making financial services relevant for the youth15

Electronic money

Cash

BUILDING BRIDGES TO CASH

Cash ↔ Electronic value

•Convenience = location, density

•Trust = brand, consistent experience

•Viability = volume per store

CONNECTING WITH MENTAL MODELS

Electronic ↔ Psychology

•Customer insight = motivations and budgeting practices

•Service presentation = intuitive, easy to use

Individual

OnlineMerchant

Downstream Business

StoreMerchant

CashMerchant

P2P

B2B

B2C P2Cash

Gov’t

G2P

Int’l

MAKING E-MONEY DIRECTLY USEFUL

Electronic ↔ Electronic

•Network effects = larger is more useful (as well as cheaper)

•Pain points of cash= willingness to pay thro e-money

Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

THANK YOU Email: samuel.ndungu@equitybank.co.ke

Web site: www.equitybank.co.ke