Family Bank Case Study | Modefin

Family Bank Case Study

Looking back, looking ahead at a long-lasting relationship

It is axiomatic in banking that diverse banks offer uniform services such as savings, lending and payments, yet their success rate differs from country to country. The key is to know local nuances, understand changing needs and launch win-win solutions that warm the heart, fit the customer’s wallet and generate revenue for the bank.

Take the case of our long-standing client, Family Bank, Kenya, ranked among the top 10 banking institutions in the country. From an unassuming start with one branch in 1985, Family Bank transformed into a full fledged commercial bank in 2007, and currently operates 92 branches serving more than 1.7 million customers across Kenya.

Modefin’s partnership with Family Bank commenced in 2014. Financial services were in a state of flux at that time. The customer profile was split as upper, middle and lower income class. The banking system was being weaned away from the notion that bank accounts were a privilege of the rich, and an era where ledger fees were charged for routine transactions was still fresh in memory. Telcos had cashed in the opportunity a few years earlier and were offering mobile wallets to the unbanked and underserved, which caused banks to lose out on the high-volume, low-income segment.

Armed with a mandate to digitise payments, Modefin got to work. A review of existing customer accounts revealed the income and money outflow of the account holder, intent to save, willingness to spend, and need for short term financing.

Modefin designed the ‘PesaPap’ mobile banking solution which included a mobile wallet and a micro saving and lending product that surpassed the typical Telco solution. Especially in lending, where the safety of the principal is the priority, Modefin incorporated such technology features that protected the bank’s interests. Credit scores were automatically generated by accessing data in real time from a licensed Credit Reference Bureau in Kenya and by assessing customer credit data provided by telco operators.

The software ensured a cap on the loan amount, a customer could avail only one loan at a time, funds were disbursed only to the borrower’s mobile number, and EMI payments or loan closure were auto debited on the pre-agreed date.

In 2018, Modefin introduced an upgraded version of the digital banking app, resulting in record amount of disbursements in the year of re-launch. The new version also allowed access to non-bank customers through integration of the service with a leading MNO. The mobile wallet also enabled transactions by merchants.

In many ways, the partnership has been a trailblazer for Modefin in the Kenyan market and case study representative of our pioneering efforts in the African continent.

Credit goes to the management for the long-lasting relationship. As a fintech partner, we echo the motto of Family Bank, “With You, For Life, and as a family member, pledge to sustain the promise.

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The meaning and depth of any business are valued considering the customers it has garnered. We at Modefin are grateful to our customers and clients whose patronage has helped us build on our efforts to succeed and give our best. These are the very persons, institutions and industries who vouch for our efforts and acclaim the reliability of our solutions. Our customer experience goals gain value when we receive affirmation of our efforts.