Stanbic suspends fintech projects months after receiving approval in Kenya

News:

  • Kenyan company Stanbic Holdings has announced it is suspending plans to launch a fintech subsidiary. This comes after the Capital Markets Authority (CMA) gave the green light to start operations in the 4th quarter.
  • A member of the Standard Bank group said its board had decided to shelve the project, but did not give details of what it planned to do with the subsidiary.
  • Stanbic Bank Kenya and South Sudan Managing Director Joshua Oigara explained that after reviewing the decision at the board level, they agreed to his temporary suspension.

While it is unclear whether the board will return to it, Oigara assured that the company will launch a subsidiary if necessary. However, he emphasized that the company will maintain this new position for the time being.

In the financial year ending December 2022, Stanbic revealed that it is considering partnering with or acquiring a fintech or mobile network operator to significantly expand its business.

The CMA announced in the fourth quarter of 2023 that it had approved the holding company’s request to create a fintech subsidiary.

In 2021, the company announced it will partner with Chinese fintech companies to strengthen trade relations between China and Africa, connect Kenyan merchants with suppliers of quality products in China, and improve online transactions in the East African country and beyond.

Standard Bank has long expressed a desire to work with fintechs, a strategy its subsidiaries follow.

For example, Nigeria’s Stanbic IBTC Holdings, a member of South Africa-based Standard Bank Group, launched a fintech subsidiary in 2022 called Zest Payments Limited. To date, the fintech subsidiary operates as a payment solutions service provider.

Standard Holdings’ net profit for 2023 was 12.2 billion shillings ($85.6 million), up 34%.

Meanwhile, Stanbic Bank Kenya increased its net profit by 30% to KSh 11.5 billion ($80.7 million), while Stanbic South Sudan’s profit rose 50% to KSh 460 million ($3.2 million).


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