Vibrancy of banking sector is music to customers’ ears

In any economy, the banking sector plays a very crucial role that even during hard times, governments are compelled to weigh in and steady the ship or else the whole economy will go down with them. The recent global credit crunch was one key example, where we all saw how the US government, for instance, increasingly bailed-out banks in order to keep the economy afloat. The case is not different in Rwanda, where government has set up different favourable policies to boost the banking sector. Government efforts have bore fruit and the sector has grown in leaps and bounds. Some banks have improved their operations in order to attract new customers and stay in the competition with their rivals. Banque Populaire is different from what it was five years ago while the same can be said about banks like Ecobank as compared to the days when it was still BCDI. The favourable government policies have attracted foreign banks. Ecobank, Fina Bank, and KCB are some of the banks that joined the fray and compelled the local banks to get their act together. Very soon, Kenya’s Equity Bank will also join the seemingly lucrative Rwanda banking sector. According to central bank, commercial banks made significant profits last year. More so, many have pointed out that Equity bank will probably boost the Small and Medium Enterprises in this country, something that fits exactly into the government’s strategy of transforming the economy. The news that Kenya’s National Industrial Credit (NIC) Bank is also eyeing the Rwandan market is proof that there is room for more players and competition, all of which are certainly mellow music to the ears of Rwanda’s bank customers. Like KCB, Fina Bank and Equity Bank, NIC is also embarking on a strategy of regional expansion. Increased competition in the banking sector is a blessing for the customers who often have to endure long queues in the banking halls, rude service from unprofessional staff as well as several bottle necks when trying to access loans and other banking services. The competition will certainly compel the banks to go an extra step in trying to woo new clients and also to hold onto the traditional ones. Banks that still charge exorbitant fees for items like cheque books and ATM cards among others should be ready for a shock, especially when industry shakers like Equity Bank join the fray. Those that pride themselves in closing their doors early will stand to lose their clients to the ones that keep them open for linger hours. The main source of competition will most likely appear in the loan sector. Considering that Rwanda presents investors with the much needed political stability for investment, many people and establishments will be interested in acquiring loans and mortgages. In such a scenario, the bank with the most favourable terms for loan acquisition and servicing will take the day. Customers should also use this opportunity to exercise their power by not accepting poor services as our President has always emphasised. If you are not happy with your bank, complain, if that does not work then move to a better bank. ssenyonga@gmail.com