Co-operative BankCo-operative Bank

Co-op Bank Launches Mobile Wallet Service: MCo-op Cash

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In line with Co-operative Bank’s vision and mission

of providing real value to our customers, the Bank

on 13th August 2014 launched an advanced mobile

wallet, ‘MCo-opCash’, that enables both customers

and non-customers across all mobile phone networks

to open bank accounts, apply for loans straight

from their mobile phones and also make cash and

utility payments. Upon registration, the customer

telephone number becomes the customer bank

account number, and transactions can commence

immediately. MCo-opCash also enables users to

transfer funds across banks, micro finance institutions

and mobile phone networks, and thereby deliver a

greatly-improved service experience to users.

The mobile wallet will foster financial inclusion by

facilitating opening of accounts on the mobile phone

through self-registration, provide customers with

a one-stop solution for their mobile banking needs

that is available 24/7, enhance the bank’s efficiency

and ensure the bank remains competitive, and be a

significant boost to the bank’s performance on non-

funded income which delivered a remarkable 37.8%

growth in the first half of 2014.

This innovation will ride on the Bank’s 4.6 million

direct customers and the over 10 million Kenyans

in the Co-operative Movement that is the largest in

Africa. SACCO members whose SACCOs bank with

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AwardsBest Innovation in Retail Banking 2014>> Page 6

Co-op Collection & receipting Making Public Transport Manageable>> Page 8

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CEOs Message>> Page 2

Pictorial>> Page 4

Co-op Awarded>> Page 6

Co-op Foundation>> Page 7

>> ISSUE 1, August 2014 >> >> ISSUE 1, August 2014

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CEO’s Desk Cover story Cont.

Message from the CEO

Dear Valued Customer

In line with Co-operative Bank’s vision and mission centred around providing

real value to our customers we are excited to announce the launch of a new

enhanced mobile banking wallet that will revolutionise the banking experience

for our customers by providing 24/7 convenience, real time, ‘touch of a button’

service through direct and enhanced integrations, robust 3600 product offering

covering your transactional banking needs, saving and borrowing needs as well

as investment and lifestyle needs.

With Co-operative Bank being host to 4 million account holders as well as

housing an additional 5 million Sacco members through their Co-operative

Societies, the launch of the platform evidently works in tandem with the banking

industry’s aggressive strategy to enhance efficiency by going electronic. The

ease of registration both electronically and at our various Branches, ATMs and

Agents country wide is centred around fostering enhanced financial inclusion

for the unbanked for which the Bank has always been a driver through its citizen

friendly banking model. The platform will be released for pilot runs in March

2014 and be fully operational by end of April 2014.

What is unique to M-Co-op Cash?

The Coop mWallet is predisposed on strengthening our partnerships with the

various stakeholders in the industry and is the first bank led mobile money service

that is open for subscription not only to anyone with a mobile phone, irregardless

of mobile network namely Safaricom, Airtel, Yu & Orange subscribers but also

to other non-Telco wallets such as Tangaza and Mobikash. Each individual’s

wallet account will be their mobile number irrespective of Telco provider thereby

ensuring ease of transaction and allowing for inclusion of all players.

Features of the new platform include:

• 5 credit products accessible to all M-Co-op Cash subscribers irrespective of

the Telco they are subscribed to.

• Self-registration for the service via the mobile phone.

• Deposit and withdrawal to and from the Wallet Account.

• Supports savings of upto Kes 200,000 on the Wallet account.

• Cardless withdrawal through our ATMs and Coop Kwa Jirani Agents.

• Registered customer access to the full list of utility payments offered by the

Bank irrespective of the Telco they are subscribed to.

• M-Co-op Cash customers can link their Co-operative Bank Account(s) to their

M-Co-op Cash Account.

• Airtime purchase can be done from all the 4 Telco’s for individual’s phone as

well as to another individual’s phone.

• M-Co-op Cash customers will be able to do EFTs to any commercial bank that

is a member of the clearing house.

• M-Co-op Cash will allow bulk funds transfer to any mobile number(s)

irrespective of whether it’s registered for the Coop mWallet or not.

• M-Co-op Cash will offer mobile money services to Sacco accounts

for Sacco members.

• Access of service at Coop Agent points and ATMs.

• Devolvement of the mWallet to other organizations e.g.Saccos,

Micro credit organizations.

• Merchant payments.

What does this mean to you?

The underlying major benefit introduced by the M-Co-op Cash is the convergence

of all mobile money services, banking services, Sacco financial services, utility

payment services and person to person funds transfer services all offered on a

single account accessed through your mobile phone.

We know you will have many questions regarding this product and have

proactively posted a Customer Q&A on our website http://www.co-opbank.co.ke

that provides answers to the important questions we anticipate you will have

after hearing the great news. You can also email any other specific queries you

have to mbanking@co-opbank.co.ke.

We look forward to confidently walking with you into this new future of

technological banking.

Dr. Gideon Muruiki- MBS

Group Managing Director & CEO

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Co-operative Bank will have access to the full range

of services through MCo-op Cash.

The underlying major benefit ofMCo-op Cash is the

convergence of mobile money services, banking

services, Sacco financial services, utility payment

services and person to person funds transfer services

all offered on a single account accessed through the

mobile phone.

The main features of MCo-op Cash include:

• Free self-registration for the service via mobile

phone, anywhere anytime.

• VarietyofcreditproductsaccessibletoallMCo-op

Cash subscribers irrespective of the mobile phone

network they subscribe to.

• Unlimitedsavings/deposits,unlikesomemobile

money services in the market that limit the

amount of cash that a subscriber can hold at any

one given time

• Card-lesswithdrawalatanyCo-opKwaJiraniagent,

and soon at any Co-op Bank ATM countrywide

• Funds transfer to any mobile phone number

irrespective of the mobile phone network and

whether it is registered on MCo-op cash or not,

including Bulk transfers.

• Access to an extensive listof utility payments

offered by the Bank including: KPLC, Nairobi

Water, KRA, Insurance.

• Linkage of a subscriber’s Co-operative Bank

Account(s), enabling the customer to check balance

and transact directly from the bank account or

transfer cash to MCo-op Cash free of charge.

• Airtimepurchaseforthesubscriber’sownmobile

phone as well as for another individual’s phone,

regardless of their mobile phone network.

• ElectronicFundsTransfertoanycommercialbank

that is a member of the clearing house.

For more information contact our call center on Tel:

0703 027 000, 020 277 6000, SMS: 16111, and

email: customerservice@co-opbank.co.ke

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>> The first Lady Her Excellency Mrs. Margaret Kenyatta receives the key to a mobile clinic that Co-operative Bank of Kenya donated to the Narok County through the Beyond Zero anti-child mortality campaign. Director Corporate and Institution Banking, Mrs. Lydia Rono, presented the mobile clinic on behalf of the bank. The fully equipped Ksh. 10 milliion mobile clinic will be used by the Narok County government to help deliver medical services to mothers and children all over the Narok County.

>> Metropolitan Teachers’ Sacco Society in conjunction with Co-op Bank launched two new products, a Sacco Personal Cheque and a co-branded Sacco Link Card at the Sacco’s AGM. Showcasing the Sacco Personal Cheque is Co-op Bank Director - Co-operatives Division, Mr. Titus Karanja (right), KUSCCO MD, Mr. George Ototo (second right), the AGM Chief Guest, Cyrus Kariamwere (center) of the Bank’s Sacco Banking Division, Mr. Christopher Karanja (second left), the Sacco Chairman and Mr. Francis Nganga (left), the Sacco CEO. Co-op Bank is a proud supporter of this and many other Saccos; working with them to enhance efficiency and profitability through the provision of affordable capacity-building solutions.

>> Co-op Bank Director - Corporate & Institutional Banking, Mrs Lydia Rono presents the new Meru County revenue collection system manual to H.E Peter Munya, Governor Meru County. With the new system the county will be able to to track down revenue collected on a real-time basis and at the same time minimize fraud.

>> Co-operative Bank’s Director of Retail Banking, Sam Birech (right) presents a Ksh. 1 million cheque to the Inspector General of Police, David Kimaiyo(left) in support of the Kenya Police Annual Athletics Championships 2014. Co-op Bank was the lead sponsor of the Annual Athletics which seek to nurture and showcase talent in the Police service. This is the fourth year running that the Bank is supporting the championship.

>> MDLC FEBRUARY WINNERS The February 2014 winners of the Bank’s deposit mobilization campaign display their certificates following the presentation by

Dr. Gideon Muriuki, Group Managing Director.

>> MDLC JANUARY WINNERS The January 2014 winners of the Bank’s deposit mobilization campaign display their certificates following the

presentation by Mr. Zachariah Chianda, Director Operations Division. The Deposit mobilization and growth of non funded incomes remains a key pillar for the bank’s profitability.

Co-op Mortgage

According to Rose & Hudgins in their book: Bank

Management and Financial Services, the authors

allude to the fact that Linguistics and Etymology

tell us that the French word banque and the Italian

Banca were used long ago to refer to a bench or

money changers table. This describes quite well what

historians have observed about the first bankers

over 2000 years ago. They were money changers,

situated usually at a table in the commercial district,

aiding travelers by exchanging foreign coins for local

money or replacing commercial notes for cash for

free. Loans in those days where mainly offered to

ship owners and landowners with most banks being

of Greek origin.

Banking later developed into a sophisticated

undertaking targeting clients with a steady income

and significant deposits. This model excluded

significant numbers in the population below the

liquidity threshold desired by financial institutions.

The focus mainly shifted to corporate clients. Recent

times have seen the retail market come under

the banks radar as the growth driver to financial

institutions and targeting these numbers using

mobile telephony platforms has emerged as the

savior to many a bank.

According to Wikipedia, the definition of Mobile

banking is; a system that allows customers of a

financial institution to conduct a number of financial

transactions through a mobile device such as a mobile

phone or personal digital assistant. The earliest

mobile banking services were offered over SMS, a

service known as SMS banking. With the introduction

of smart phones with WAP support enabling the use

of the mobile web in 1999, the first European banks

started to offer mobile banking on this platform to

their customers. Closer home Safaricom currently

has 75 per cent of the adult population on M-Pesa

services, conducting transactions worth more than

Sh2 billion daily.

Central Bank of Kenya data further shows that

transactions valued at Sh1.9 trillion were made

through mobile money in 2013. In December alone,

25 million people carried out a transaction using

mobile money. The success of the mobile banking

service can mainly be attributed to a number of

factors: The high cost of rolling out physical branches

covering entire geographies, sparsely populated

regions of the country and a less than optimum

transport and communication infrastructure that

characterizes the Kenyan landscape.

The mobile phone in this case successfully to a large

extent, surmounts these challenges through Over the

Air (OTA) accessibility that has made reaching people

via this method an attractive business model.

Moving forward, the aggressive efforts by financial

institutions will serve to hasten financial access to

the masses thus taking financial services from the

people, away from them to the corporates and back

to the people. One may therefore conclude that

Mobile Banking in Kenya today and the Future - Has banking come full circle?Article by: Stephen Kirui, Brand Manager, Marketing Co-op Bank

Pictorial

As your bank, we are making all e orts to prevent ATM fraud. Here are 4 tips that can help you to ensure your PIN is safe:

1. When entering your PIN at the ATM always cover the numbers with your hand.

2. Avoid writing your PIN on your phone or keeping it in your wallet, you never know when they can be stolen, always memorize your PIN.

3. Do not give out your PIN, card number or account number to anyone.

4. Only enter your PIN when prompted to do so by the ATM.

It is in our interest to ensure that your hard eared money is safe so therefore should you see anything suspicious at the ATM please contact any of our Alert Hot lines below.

4 Tips to protect your PIN

020 277 6000, 0703 027 000 or 0736 690 101 or SMS 16111.

Email us atcustomerservice@co-opbank.co.ke

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Co-op Awarded

Co-operative Bank of Kenya received top awards in two categories: Innovation in Retail Banking and Best CEO Africa at the International Banker magazine annual awards which recognizes the top banking institutions across the Middle East and Africa.

The International Banker magazine offers a global view of banking and brings in-depth analysis on the people and innovations within financial services that drive the industry forward. Its annual awards recognize banking excellence globally. Honoured with a dual award, to acknowledge and celebrate innovation and leadership, the Co-operative Bank of Kenya topped the awards lists this year.

The first, and most prestigious, award was Banking CEO of the Year, Africa, awarded to Dr. Gideon Muriuki (Co-operative Bank of Kenya). As the head of the bank, Dr. Muriuki receives recognition for promoting the co-operative banking model throughout Kenya and his leadership in driving a sustainable growth model. In particular, Dr. Gideon Muriuki has demonstrated remarkable foresight by insisting that the Co-operative Bank of Kenya retain its identity as a co-operative bank even when expanding into additional parts of Africa outside Kenya, in spite of the fact that it would have been easier for the enterprise to proceed as a successful Kenyan commercial bank. Expanding to other African markets, beginning with South Sudan, by way of joint ventures with co-operative societies in those countries is a futuristic business model that is likely

to deliver inclusive growth and a more equitable sharing of the benefits of the rising prosperity of African economies.

Dr. Muriuki has since turned around the bank from loss-making to one of East Africa’s fastest-growing and most profitable banks. The bank has achieved consistent year-on-year growth in results, substantial growth in customer base and expansion of services into Sudan – a lucrative growth area for the Kenyan banking sector. He has furthermore set up numerous bank led initiatives to benefit the community.

The second award was made for Innovation in Retail Banking, Kenya. The Co-operative Bank of Kenya has driven the adoption of banking services amid a growing economy. International Banker was particularly impressed by the bank’s commitment to providing scholarships for underprivileged students, green energy financing packages and low-interest loans for small and medium-sized enterprises, which may prove crucial in terms of Kenya’s future economic growth.

The Co-operative Bank of Kenya has demonstrated a consistent commitment to providing inclusive retail banking services in Kenya. Under Dr. Muriuki’s leadership, the bank has successfully pioneered a retail banking model that goes beyond investment in conventional bank-owned channels such as branches, ATMs, agencies and electronic banking. The bank has invested substantially in over-the-

counter banking services and payment card systems operated by co-operatives to serve their members, which currently number over two million. The bank’s support by way of affordable financing, capacity-building and critical technical support has enabled over four hundred co-operatives to offer front-office banking (FOSAs) to over two million banking customers. In addition, the bank’s huge investment in a payments switch (Coopswitch) that has enabled Kenya’s vibrant Savings and Credit Co-operatives (Saccos) to access card payment services worldwide, is a ground-breaking innovation towards achieving financial access to the majority.

A spokesperson for International Banker explained, “The Co-operative Bank of Kenya is one of Kenya’s fastest-growing banks and has risen to become one the country’s biggest five banks. Having been in business for over forty years, it has seen its highs and lows but has overcome these by continually evolving its approaches, which can be especially difficult for co-operatives who typically struggle to drive innovation and internal reform.”

When asked to comment, Dr. Muriuki noted, “The over 10 million-member co-operative movement that holds a 65% majority stake in the bank, is the face of Kenyan people, and with continued teamwork and innovation, the bank will play a pivotal role in the growth of the regional economy.”

Co-operative Bank of Kenya Tops International Banker Awards 2014

�e Co-operative Bank of Kenya has been awarded the ‘BEST INNOVATION IN RETAIL BANKING 2014’ and the Group MD, Dr. Gideon Muriuki, ‘CEO OF THE YEAR AFRICA 2014’ by the International Banker. We accept this global recognition with great humility and are encouraged to continue providing our customers with transformative banking solutions. �e over 10 million member Co-operative movement is the face of our dear Nation. Indeed, “We are you”.

Co-op Foundation

Co-operative Bank increases education scholarships to almost 2,800 students

The 2014 Co-op Foundation interns pose with Co-operative Bank MD & CEO, Dr. Gideon Muriuki during the foundation’s university and vocational internship program induction. The Foundation is Co-operative Bank’s vehicle for social responsibility, whose current flagship project is the education scholarship scheme for bright but less endowed children. Also present is Mrs. Rosemary Githaiga, the Bank’s Company Secretary, Mrs. Weda Welton, HR Director, Mary Anne Njoroge from Marketing & PR, Stephen Gichuki and Ann Muigai from the Co-op Foundation.

The Co-operative Bank of Kenya has increased

its secondary school scholarships for bright but

financially disadvantaged children from all over

the country to almost 2,800 students in 4 years,

from the previous 1,400 students. The additional

scholarships will be awarded by the bank’s Regional

Delegates Forums and the 47 County Governors to

the incoming Form One Students, the bank’s Group

Managing Director and CEO Dr. Gideon Muriuki

has said. Every year the regional Co-operative bank

delegates’ forums will award 420 Scholarships

while the County Governors/ County Executives for

Education will award the remaining 235 scholarships

countrywide, at 5 per county, making the total of

655, Dr. Muriuki added.

These additional scholarships mean that in the next

four years the bank will have educated, for free,

almost 2800 students. Additionally, the bank will

be educating another over 140 students in various

universities and colleges across the country. When

added to the number of students educated since the

year 2007 when the Co-op Bank Foundation was

started, the bank will have provided education to

over 5,000 bright students who otherwise would not

have been educated.

Commenting further on this program, Dr. Gideon

Muriuki said, “Co-operative Bank has one of the

most democratic systems of granting scholarships

in Kenya. Our students are selected at the grassroots

level by Co-operative Societies across the country

through a well-established national delegates

system. Co-operative Societies, who are the face

of Kenya, identify well-performing students from

disadvantaged backgrounds and bring these names

into a regional forum where delegates debate and

select the most deserving cases. At the banks’ head

office, our role is to process payments to the schools

and monitor the students’ performance through

the four years in secondary school. The top 4 in the

Form Four examination in every region are granted

an additional full scholarship for their university

education.

Commenting on the reason why the bank has chosen

education scholarships as its flagship Corporate

Social Investment, Dr. Gideon Muriuki observed that

education is one of the most expensive items in any

household budget and yet has the highest potential

to liberate people from poverty. “Unless corporate

institutions and all people of goodwill come

together to support initiatives within the education

sector, brilliant but poor Kenyans will never realise

their full potential. Being poor does not mean that

one isn’t bright or has no potential. Majority of

Kenyans holding positions of responsibility today

were educated with loans from the Co-operative

Movement. It is for this reason that the Co-operative

Bank, being the premier co-operative institution in

Kenya, has taken the lead in this area.”

Co-operative Bank provides full school fees

scholarships for the entire four years of secondary

education. University scholarships are awarded to

the best performing students from each region. The

scholarship program was launched in 2007.

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Co-op Collection & receipting

Co-operative Bank of Kenya Ltd. (Co-op Bank) has

launched two products aimed at managing cash

collection and employment issues within the matatu

industry. The two products are a cashless collection

and receipting service, as well as a system that will

help in the management of staff and fleet.

In a bid to streamline the industry, the government

recently ordered that all matatus employ their

crew and staff on a permanent basis, and that all

fare collection must be cashless and receipted,

beginning 1st July 2014. Co-op Bank, being the

financial adviser of the Matatu Savings & Credit

Co-operatives (SACCOs), not only developed the

products, but also held a forum aimed at sensitizing

them on the new requirements.

The fleet-management product features a service

that gives the matatu owner or SACCO control of any

given vehicle’s collection. It tracks all fare transactions

and records total collection in real time, via a unique

and independent link assigned to each vehicle. The

link will also contain information on all registered

bank accounts. The monitoring can be done by the

use of mobile phone, tablet or computer.

Through this unique product, passengers will pay

their fare using any one of the following means: debit

and credit cards, prepaid or loyalty cards, mobile

money wallets, MPESA, Airtel money, Orange, YU

Cash, Tangaza, NFC Cards, virtual accounts and for

the short-term period cash transactions.

In addition to the new products, Co-op Bank offers the

over 700 registered matatu SACCOs in the country

a myriad of services. These are: the development of

HR policies, financial management and governance,

board training, development of strategic plans,

development of products and services that they can

in turn offer their clients, establishment of Front

Office Services (FOSAs) and Bancassurance. These,

the bank offers through its subsidiary–the Co-op

Consultancy and Insurance Services Ltd (CCIA).

Co-operative Bank Making Public Transport Manageable

...passengers will pay their fare using any one of the following means: debit and credit cards, prepaid or loyalty cards, mobile money wallets, MPESA, Airtel money, Orange, YU Cash, Tangaza, NFC Cards, virtual accounts and for the short-term period cash transactions.

Co-op Bank Consultancy & Insurance Head, Vincent Marangu (center) demonstrates the use a new online payment technology to Peter Kibugu (left), Chairman South B Matatu Sacco and Harry Thuku (right), Credit Chairman South B Travellers Sacco. The system empowers Matatu owners and Saccos to track payment transactions in a matatu giving the owners access to the total collection at any given time via mobile phone or a computer.Each vehicle will have a unique and independent link that will enable the owner to track all transactions in real time. This is the bank’s solution to the Government requirement that all public transportation charges collection be done cashless.

©The Co-operative Bank of Kenya, call centre 020 277 6000, 0703 690 101, SMS 2020or email us at customerservice@co-opbank.co.kelike us on Facebook at co-opbank and follow us on Twitter # Co-opbank