BI crucial for Kenyan banking

11 March 2011

Business Intelligence technology is becoming increasingly important for Kenyan banks, as customers become more discerning and competition grows more intense.

This emerged in a white paper released ahead of the Aitec Banking and Mobile Money COMESA in Nairobi next month by one of the event speakers, Shailendra Mruthyunjayappa, VP & BU Head for Africa & Europe at iCreate Software.

Mruthyunjayappa says the new banking environment in Kenya is all about differentiating banking products, increased choices, security and accessibility.

He notes that most banks have introduced internet banking, mobile banking and other e-banking facilities, to enhance delivery channels to their customers.

However, he says, with automation taking center stage and with every bank trying to improve its processes and systems to outdo its competition, implementation of BI technology will be a key differentiator and a decisive factor.

With increased challenges like declining interest margins and compliance to the Finance Act 2008 that requires banks and mortgage firms in Kenya to build a minimum core capital of Sh1 billion by December 2012, banks need a centralized information solution that will help them gain a competitive edge whilst meeting regulatory requirements.

Again, from a reporting and data visualization perspective, banks require the ability to present data in different and meaningful ways and in real-time. It is critical that banks should have the ability to generate incisive reports - a quick turnaround time on information is key in a competitive environment.

For example, instantly generating information about a target customer base for tailored promotions, taking advantage of a particular market condition, will mean the difference between a successful marketing campaign and a costly marketing failure for a bank.

“This is where innovative technologies like Business Intelligence will play a crucial role. Implementing BI tools (data warehousing, data mining, scenario development and reporting, analytical tools for predictive and descriptive modeling) will enable banks in Kenya to understand their business better, manage risk and compliance, improve performance, expand their markets, increase their understanding of their customers, analyze channel profitability, devise product strategy, achieve operational excellence, and above all gain visibility into their profitability,” he says.

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