Why Kenyan Banks Have drastically Reduced number of ATMs available to Customers
Banks in Kenya have reportedly slashed the number of Automated Teller Machines (ATMs) available for use in the East African country. This comes after ATM usage in Kenya dwindled to all time lows, with Kenyans now preferring to use alternatives such as agency, internet banking, and mobile banking.
Data by the Central Bank of Kenya has shown that about 54 ATMs across the country were shut down over the past twelve months, according to checks by Business Elites Africa. This brings the current number of ATMs in the country to 2,409 units. The report also noted that that this is the lowest number of ATMs ever reported in Kenya has 2013.
Do note that this is not such a bad-news for the banks which are set to witness a sizable reduction in the revenues earned from ATM transactions. After all, they will continue to make money from mobile and internet banking. Yet, the biggest winners might as well be the growing list of fintech startups that are offering agency banking services, and [of course] the customers who now have a wide array of financial services options to choose from.
One of the factors that fast-tracked the reduction of ATM usage in Kenya is the COVID-19 pandemic. According to the report by the Central Bank of Kenya, hundreds of thousands of Kenyans opted for cashless transactions as a way of reducing their chances of contracting the virus. Consequently, cashless transactions in Kenya had increased dramatically between April this year and October.
Perhaps, this is a wakeup call for Kenyan banks (and banks across Africa) to do more in terms of building the necessary technology that will facilitate more cashless transactions. Indeed, the banking system in Africa needs to shift from brick and mortar to a more technologically-advanced stage where lots of branches and ATMs are not absolutely necessary.
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