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National Bank of Malawi (NBM) plc Chief Executive Officer (CEO) Harold Jiya has unveiled plans to set up a financial technology (Fintech) company to help minimise costs incurred in purchasing systems from different companies.
Guia, who succeeded McFussy Kawawa in the top management post this month, outlined the plans during a media interaction on Wednesday, while also laying out the bank’s five-year strategy.
In his speech, Guia said that in addition to fintech companies, the bank also expects to achieve significant growth in four African countries, with after-tax profits increasing from the current $60 million to $100 million and the customer base growing to 2 million by 2027.
On cutting costs through fintech firms, Jiya said this was essential as the bank had more than 28 systems provided by different vendors whose licenses and annual maintenance fees were paid in US dollars.
“Why can’t we have an institution, an IT company, that specializes in these products? It can start by supporting and learning from the national banks, and also support the banks that we will acquire in the region.”
“Now, by supporting banks in the region, it will be charged in US dollars and we believe it will become a profit centre for Support National Bank PLC. We believe that once we achieve critical mass, it will provide us with appropriate savings which will help improve our profitability,” Jiya said
He also stressed on how to take the bank to the next level.
“We had a strategic plan, which I was involved in formulating. We were very clear about the path we wanted to take. So when I assumed the leadership of the bank, I was confident that I would achieve this strategic plan. Our plan was for this bank to achieve $100 million in profit after tax by 2027, become the number one digital bank in the country, and enter the region, expand our footprint, ensure that we have representation in four countries with over 2 million customers,” Jiya said.
Jiya also said they expect 12% of the estimated $100 million profit after tax in 2027 to be contributed by NBM plc’s subsidiaries, which include Akiba Commercial Bank in Tanzania, NBM Pension Management Limited, NBM Development Bank, NBM Capital Markets Limited, United General Insurance Company (UGI) and Malawi Stock Brokers Limited.
On financial inclusion, the new CEO highlighted plans to empower agent banks to provide seamless banking services in rural areas where banks do not have a presence.
“We have people operating in rural areas and we intend to enable these people to also provide our services. People in rural areas should be able to deposit and withdraw money through these agents. Our Mo626 USSD service also provides every Malawian with the opportunity to access financial services through their mobile phones,” he said.
He further introduced the current situation of Akiba Commercial Bank in Tanzania, saying that the bank’s losses have been greatly improved and its future prospects are bright.
“When we acquired Akiba Bank three years ago, the bank was losing K4 billion and this year the loss is less than K1 billion. This means we are now talking about profits instead of losses,” he explained.
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