KCB Group is set to acquire a 75% stake in payments solutions startup Riverbank Solutions for $15.4 million (Ksh.2 billion).
KCB Group is Kenya’s largest commercial bank by assets, with operations cutting across East Africa
The reason for the acquisition if for the lender to strengthen its digital operation, but the transaction awaits regulatory approval.
Once approved, it would be KCB Group’s latest and the largest acquisition in the wake of growing competition in the digital services among commercial banks
It is looking to increase its ability to offer integrated digital services with the Riverbank acquisition, which provides payment and revenue collection systems to banks, e-commerce platforms, and government agencies.
“We are actualizing new digital capabilities to deliver customer-centered value propositions through technology to guarantee seamless, reliable, secure, and innovative solutions for our customers,” said Paul Russo, KCB chief executive.
“Across the region, payments are expected to have the fastest growth, suggesting an opportunity to innovate.”
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Riverbank Solutions was founded in 2010 by Nick Mwendwa – former Football Kenya Federation (FKF) President.
The firm provides payment systems to manufacturers, microfinance institutions, retailers, county governments, and the military.
It operates in Kenya, Uganda, and Rwanda – offering a range of digital services, including Zed 360, a management tool for small businesses; Swipe, which supports agency banking services; Zizi, a revenue collection platform; and CheckSmart, designed for social payments.
In Kenya, the counties of Kisumu and Migori are currently leveraging Riverbank Solutions for revenue collection.
It will not be the first time KCB Group has interacted with Riverbank Solutions. According to Russo, the lender first partnered with the platform 2013.
KCB has been using its services to run its agency banking network. And with the acquisition almost coming into play, Riverbank will be used to provide small and medium enterprises (SMEs) with financial management tools, digital loans, and treasury management.
“We have made this strategic acquisition to enable us to offer a full stack solution. This is a great opportunity to maximize value for our shareholders in the long term while strengthening the group’s competitive position,” said Russo.
KCB Group’s profit after tax for 2024 grew 64.9% to $477.9 million (Ksh.61.8 billion), driven by strong revenue growth across all business segments.
Non-interest income, including earnings from non-banking services, rose 16.5% to $522 (Ksh.67.5 billion), supported by higher foreign exchange trading income.
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