Equity Bank Group Youth Banking Vision To be

Equity Bank Group Youth Banking Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

……. . The current, unprecedented level of global youth unemployment has raised the risk of creating "a lost generation, “……… Nemat Shafik, deputy managing director of the International Monetary Fund (15 th March 2012) Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

“…I do not know about banks, I cannot pass in front of the bank because of how I look”. Youth in Kenya Equity Bank Market Research Report - 2011 Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.

East Africa Statistics q 5 East African countries q. Population of about 135 Million q. Estimated number of youths (below 24) – 87 M (65%) Uganda leading with 70% q. Population below poverty line – 50% q. Youths with savings accounts – 13% q Mobile phone penetration (2010) 411/1000 – growth of 378% between 2005 -2010 q About 75% of the 40% unemployed is made up of the youth

Mobile Phone Penetration Country 2005 2008 2010 Penetration growth 2005 - 2010 Tanzania 86 320 360 319% Kenya 152 361 521 243% Rwanda 49 250 360 635% Uganda 57 289 404 609% Totals 86 305 411 378%

Equity Challenge Item (Approx. 135 M) Equity Bank Gap to (Approx. 7 M) Coverage Below 30 years 73% 36% +37% 30 -40 years 13% 30% -17% 40 -50 years 6% 18% -12% Above 50 years 8% 16% -8%

Drivers of Youth Innovation. Equity Bank Group Demographics Changes in customer base composition (youth bulge/demographic dividends, sophistication and dynamism requires banks to focus on differentiation. 24/7 availability of banking services Technology Youth affinity for technology-based solutions, the social media as an integral platform, technology convergence (e-commerce & mcommerce) Equity Banking Model Huge volume vs small margin making EBL ‘cheap’ as compared to competition, cut operational costs, financial inclusivity vis avis youth population, managing business model disruptive technologies given banking/telco convergence

Drivers of Youth Innovation. Equity Bank Group Cut-Throat Competition Traditional vs. Contemporary competition – Demand for choice, Telco-Banking convergence, banks downscaling to microfinance, micro finance up-scaling to banks Globalization Universality of the Youth dynamism, youth-friendly service points like agent banking , mobile solutions & POS at merchants that ensures service access 24/7 Availability of ‘cheap’ but appropriate technology ubiquitous nature of mobile application technology,

ICT innovations to support Youth Banking - Equity Bank Group Mobile phone driven Transactions Utility payments- electricity payments, water payments, school fees payments, Un-denominated Air time top ups (buying what you can afford) direct top up from your account Temporary overdraftstemporary overdrafts against remittances for emergencies Specialized Loans for the youth in ICT investments In conjunction with local universities and telcos; funding of laptop acquisitions (empowering youth to create applications that can be commercialized)

ICT innovations to support Youth Banking - Equity Bank Group Youth mobilization into the formal financial space Traditional and contemporary group approach – financial deepening, inclusivity ICT innovation Centers Enabling innovation through incubation. The bank is in the process of opening the 1 st innovation center targeting youths with creative ideas that can be packaged into commercial ventures

Youth Inclusion- Digital Natives: What they Want What dig. natives want? Online 24/7 EBL Proposition Online, real time 24/7 Obtain & use it right now Self-Service channels Keep clients plugged-in ubiquitous Self-Service channels Make it easy (simplicity) Save time Boost uptake (viral) Save money Reduce costs & time Experience (the Wow factor!) Convenience ‘un-traditional’ /hip/cool = High security 11 Control my risks High security Bio, PIN, alerts etc

Youth Inclusion Digital Natives Engagement Strategy Micro-Insurance Savings Sophisticated Financial Services Loans- funding innovation Investments – & Entrepreneurship wealth creation Retail & Micro. Payments P 2 P Transfers Cash withdrawal & Cash deposits Online payments & transfers CHANNELS Transactions Transaction Technology (NFC, Mobile Apps, etc. )

The ultimate offering

14 Introducing the Equity solution PURPOSE VISION MISSION “Including and expanding” Re-building the foundation for a bank that truly serves all Young Africans “Ubiquitous Financial Partner” “The new banking hygiene factors” “The Equity secret sauce” Daily relevance Un-cashed Many services Simple Accessible Service Universal Mass market Respect

Making financial services relevant for the youth BUILDING BRIDGES TO CASH MAKING E-MONEY DIRECTLY USEFUL Gov’t Electronic money CONNECTING WITH MENTAL MODELS P 2 P Int’l G 2 P Individual B 2 C P 2 Cash Online Store Cash Merchant Downstream Business Cash B 2 B Electronic ↔ Psychology • Convenience = location, density • Network effects = larger is more useful (as well as cheaper) • Trust = brand, consistent experience • Pain points of cash= willingness to pay thro e-money • Customer insight = motivations and budgeting practices Cash ↔ Electronic value • Viability = volume per store • Service presentation = intuitive, easy to use 15

THANK YOU Email: samuel. ndungu@equitybank. co. ke Web site: www. equitybank. co. ke Vision: To be the champion of the socio-economic prosperity of the people of Africa. Mission: Statement: We offer inclusive, customer-focused financial services that socially and economically empower our clients and other stakeholders.