CBA officially opens its doors in Uganda

By Silvia Nyambura

Uganda’s financial sector continues to present a lot of opportunities for new players. With only about 6.6 million bank accounts out of a population of over 35 million, most being youth between 18 and 35, there is still room for new players and specialized services.

It is on the back of these numbers that the Commercial Bank of Africa (CBA) with roots in Kenya has officially launched its activities in Uganda. The bank previously had established operations in the country but left in 1971 following political developments. In 2012, CBA re-entered Uganda as a Greenfield Business, was granted a commercial banking license in January of 2014 and has been operating ever since. Its core business is centered around corporate banking, business/SME and personal banking sectors, providing a full range of financial products and services.

Speaking at a press conference held at the Bank’s headquarters in Kampala this morning, Samuel Odeke the CBA Chief Executive Officer said, “The integration of the East African Community (EAC) has provided great opportunities. It combines not only a larger population of the un-banked but also the discovery of natural resources like oil and gas and other minerals. These are all great prospects for investment that as a bank we want to tap into.”

He explained CBA has over the past 2 years provided financing for a number of sectors including infrastructure, trade and manufacturing but has continued to identify other areas of expansion.

“So far we have invested Ushs 50 billion in capital including the Ushs 25 billion requirement by the regulator. This is a clear indication of our commitment to this market. Although we have not been able to recover all the investment, as of December 2015 we were able to break even and meet all our operational costs. This is impressive growth in such a short period of time. This has been made possible through our customer-centric services, good management and referrals from our mother company in Nairobi Kenya,” Odeke added.

The bank has a few unique credit products including Visa credit cards, insurance premium financing that sees CBA pay insurance companies for premiums on behalf of clients and the customer pays back with interest, to mention but a few.

“We are in the process of getting approval from the Central Bank to launch a Micro Savings and Loan Products to the mass market through Mobile Telecom platform. This will allow customers save as well as access loans through their mobile phones. Although our loan default rate has remained lows despite the risk that comes with our products, we are linked to Credit Reference Bureaus that further help us maintain risk,” Odeke explained.

CBA Board Chairman Dr. William Muhairwe said, “There are only about 6 million Bank accounts in Uganda with a little over 18 million Mobile Money accounts. This goes to show the opportunities available in the market.We target the high end of the market and high networth individuals to drive financial inclusion.”