Few days after Competition Authority of Kenya(CAK)gave Branch International the approvals to acquire the Century Microfinance Bank.
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https://www.businessquest.co.ke/century-microfinance-bank-sale-approved-by-competition-authority The fintech enterprise has welcomed the approval from Central Bank of Kenya(CBK) for its plan to acquire Century Microfinance Bank.
Branch International Limited,a digital lending financial solutions provider through its local subsidiary Branch Kenya, has already secured the necessary Ministerial exemption and regulatory approvals allowing it to conclude the acquisition of a majority stake in Century Microfinance Bank Limited effective January 1, 2022.
With the acquisition, Branch Kenya will soon be making a landmark transition as the first digital lender to expand into the microfinance banking market, allowing for deposit-taking financial services and enhanced lending for individuals and SME clients with the controlling stake acquisition approval.
In a press release, CBK welcomed the transaction, describing it as a critical component of Century MFB’s transformation plan.The transaction, CBK said, will strengthen Century MFB and support the stability of the microfinance banking sector.
Branch also received approvals from the Competition Authority of Kenya (CAK) in May 2021.
Regulated and licenced by the Central Bank of Kenya as a DTM, Century Microfinance Bank was established in 2012 as the seventh Micro Finance Bank (MFB) in Kenya.
The firm has provided a full range of financial services such as savings accounts and credit facilities to its more than 26,000 clients in Kenya.
According to Branch East Africa Managing Director Rose Muturi, the National Treasury’s exemption and Central Bank of Kenya’s approval of the acquisition bid will accelerate efforts by Branch International to expand its local operations in their strategy towards a Pan-African digital bank.
The acquisition, she said, allows Branch Kenya the opportunity to ramp up the power of financial access by delivering world-class financial services to the mobile generation.
She added that the corporate acquisition would also provide a platform to bridge the financial services access gap using digital solutions.
“Branch International has received the approval news with excitement as this development now sets us on a growth path to deliver differentiated personal finance solutions for our growing customer base in Kenya,” Muturi said.
She added that “This approval is a major national milestone towards the deepening of financial access and continues to enhance Kenya’s position as an investment destination. It will also allow the conclusion of this transaction which has been made possible by the support and co-operation of Century Microfinance Bank, one of the leading players in the Microfinance banking space.”
Century Microfinance Bank Chairman Peterson Mwangi said the acquisition will boost the national financial inclusion efforts as the firm continues to adapt and deliver digital-driven solutions.
“Century Micro Finance Bank was first set up as a deposit-taking microfinance institution focusing on agricultural finance and offering agriculture-based credit and savings products. We have, however, expanded our portfolio to cover other financial services to the micro, small and medium enterprises (MSMEs) that serve the farmers as suppliers and buyers, and the acquisition by Branch International will provide much-needed impetus for growth,” said Mwangi.
Headquartered in San Francisco, United States, Branch International operates in India, Kenya, Tanzania, and Nigeria.
Branch has been working to break the traditional financial access barriers such as a credit score and bank account by tapping into the rise of mobile technology to reach underserved populations in its operating markets.
Currently, Branch has managed to digitally disburse more than US$ 600million to a growing customer base of more than 4million customers.
Founded by Matt Flannery and Daniel Jung, the pioneers of microlending and leaders in finance and technology, Branch International has received equity investment support from several venture capital firms. Including Andreessen Horowitz, Formation 8, CreditEase Fintech Investment Fund (CEFIF), IFC, Khosla Ventures, Trinity Ventures, Victory Park, Triple Point Capital, Foundation Capital and Visa.