The news:
- Kenya’s Stanbic Holdings has announced that it’s pausing its plans to launch a fintech subsidiary. This comes after the Capital Markets Authority (CMA) gave it the go-ahead to begin operations in Q4 2023.
- The member of the Standard Bank Group says its board has decided to put the plan on hold, but it has not revealed any details about what it plans to do with the subsidiary.
- Joshua Oigara, Chief Executive Officer (CEO) at Stanbic Bank Kenya and South Sudan, explained that after reviewing the decision at the board level, they agreed to put it on hold for the time being.
While it is unclear whether the board will return to it, Oigara assured that the company will launch the subsidiary if necessary. He noted, however, that the company will maintain this new position for now.
In the fiscal year ending December 2022, Stanbic disclosed it was considering partnering with or acquiring a fintech or mobile network operator to expand its business significantly.
The CMA announced in the fourth quarter of 2023 that it had approved the holding company's request to incorporate a fintech subsidiary.
In 2021, the company said it’d partner with Chinese fintech firms to enhance Sino-African trade relations, connecting Kenyan traders to quality product suppliers in China and improving transactions within and outside the East African country.
Standard Bank has long expressed a desire to work with fintechs, a strategy that has been observed with its fellow subsidiaries.
For example, Nigeria’s Stanbic IBTC Holdings, a South African-based Standard Bank Group member, launched a fintech subsidiary called Zest Payments Limited in 2022. To date, the fintech subsidiary functions as a payment solution service provider.
Standard Holdings’ net profit for 2023 stood at a whopping Sh12.2 billion ($85.6 million), representing a 34% increase.
Meanwhile, Stanbic Bank Kenya increased its net earnings by 30% to KSh11.5 billion ($80.7 million), while Stanbic South Sudan's increased by 50% to KSh460 million ($3.2 million).
