KUDA cushioned with $90m pitches itself as ‘the bank of the free’
By Jeph Ajobaju, Chief Copy Editor
KUDA Bank has $90 million in its vault that gives it an edge among the 10 leading microfinance banks (MFBs) in Nigeria.
Central Bank of Nigeria (CBN) website lists 916 licensed MFBs which provide financial services – savings, lending, domestic fund transfers, et cetera.
They cater to low-income earners, the unbanked and under-served groups such as market women and unemployed youths.
Only 64 per cent of Nigeria’s adult population are financially-included, so microfinance banks have a wide fertile ground to cover and reap rich rewards.
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Ranking metrics
The top 10 microfinance banks have set the pace and are holding the ace in efficient service delivery, innovation, and customer satisfaction, among yardsticks Nairametrics used to rank them, as the list below:
1. KUDA Microfinance Bank
KUDA, the top MFB, has taken the financial services industry by storm. It launched in 2016 as Kudimoney offering online-only savings and digital lending.
Since then, it has transformed to its present name, raised over $90 million, and popularised itself among the youth as “the bank of the free”.
KUDA positions itself as a major microfinance bank.
New customers are signing up every day, thanks in part to its simplified banking app that makes it very easy to register and get access to a wide array of banking services.
2. LAPO Microfinance Bank
LAPO was established in the 1980s to help the poor cope with the harsh economic realities of the Structural Adjustment Programme (SAP) under Ibrahim Babangida.
It has since become one of the most notable MFBs, based on its ensuring that low-income households are economically empowered by providing “responsive financial services on a sustainable basis,” as it claims on its website.
3. ACCION Microfinance Bank
ACCION has pursued a mission since its establishment in 2006 to “empower micro-entrepreneurs and low-income earners by providing financial services in a sustainable, ethical and profitable manner,” per information on its website.
It offers different types of loans for small business, homeownership, education, et cetra – up to N150,000 through ACCION mobile banking or USSD channels.
4. Mutual Trust Microfinance Bank
Mutual Trust was founded in April 2016 when it rebranded its name from Mark de Rock Microfinance and changed its management with aim to redefine microfinance in Nigeria.
It prides itself on providing excellent financial services with cutting edge technology and highly experienced workforce.
Customers are able to complete their loan application in under 10 minutes. Loan applications are analysed and approved in 10 hours. A flexible repayment plan allows customers to easily offset their loans.
5. Assets Microfinance Bank
No discussion about the best MFBs would be complete without Asset Microfinance Bank. Although relatively new, it has positioned itself as a force to reckon with through unique products to empower businesses.
Assets Microfinance website says it was established by the CBN to provide personal, business, and payday loans as well as savings and investment services.
6. Fina Trust Microfinance Bank
Fina Trust says it is “Nigeria’s foremost Microfinance Banks”, which is debatable. What is not disputed, however, it is one of Nigeria’s leading microfinance banks.
It was established in 2009 and is reportedly affiliated with LOLC Group, the largest, non-banking corporate entity in Sri Lanka.
Fina Trust provides quick loans – salary advance, SME loan, education loan, financial asset financing and also offers savings, current, and fixed deposit account services.
7. AB Microfinance Bank
AB Microfinance, established in 2008 with Lagos as its headquarters, describes itself as “a socially responsible bank of choice for micro and small enterprises”.
Customers are given access to micro-loans, SME loans, and housing loans.
It also offers savings, current, and fixed deposit accounts besides mobile banking and other related services.
8. VFD Microfinance Bank
VFD Microfinance Bank (VBank for short) is marketed and positioned as the go-to MFB for the trendy. A subsidiary of VFD Group, it was established in 2009 and began operation in 2011.
VBank says on its website that its services are fully re-imagined to give customers more, with a lot of focus on digitisation. VBank mobile app is arguably one of the most advanced and best stream-lined.
9. Sparkle Microfinance Bank
Uzoma Dozie, former Managing Director of defunct Diamond Bank, launched Sparkle in 2019 to democratise access to finance for small businesses and individuals.
Technology plays a huge role in its operations.
Sparkle mobile app downloaded from Google Play Store or the iOS store provides access to a host of financial services.
10. BoI Microfinance Bank
BoI Microfinance, established in 2002, is a subsidiary of Bank of Industry, one of Nigeria’s oldest banks.
It offers different types of services to small and medium sized enterprises as well as low-income earners to encourage entrepreneurship through easy loans.
BoI also provides savings deposit. Financial backing from the Bank of Industry positions it well to serve customers.
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