KCB Group, Kenya's largest commercial bank by assets, is poised to acquire a 75% stake in payments solutions startup Riverbank Solutions for $15.4 million (KES2 billion) pending regulatory approval. This strategic move aims to bolster the bank's digital capabilities and expand its footprint in the region.

The acquisition marks KCB's latest effort to stay ahead of the competition in Kenya's banking sector, which is experiencing rapid growth. Riverbank Solutions provides payment and revenue systems to banks, e-commerce platforms, and government agencies, making it an attractive asset for KCB Group. The startup's platforms will enable KCB to offer integrated digital services, enhancing its ability to deliver customer-centered value through technology.

"We are actualizing new digital capabilities to deliver customer-centered value through technology to guarantee seamless, reliable, secure, and innovative solutions for our customers," said Paul Russo, KCB chief executive. Russo highlighted the opportunity to innovate in the payments space, which is expected to experience the fastest growth in the region.

Riverbank Solutions, founded in 2010 by Nick Mwendwa, operates in Kenya, Uganda, and Rwanda, providing payment systems to a diverse range of clients, including manufacturers, microfinance institutions, retailers, county governments, and the military. The company's platforms include Zed 360, a management tool for small businesses; Swipe, which supports agency banking services; Zizi, a revenue collection platform; and CheckSmart, designed for social payments. Kisumu and Migori counties currently utilize Riverbank's platform for revenue collection.

KCB Group has partnered with Riverbank Solutions since 2013, leveraging its platforms to run its agency banking network. The bank plans to expand the platform to provide small and medium enterprises (SMEs) with financial management tools, digital loans, and treasury management. This strategic acquisition will enable KCB to offer a full stack solution, maximizing value for its shareholders in the long term while strengthening the group's competitive position.

KCB Group's profit after tax for 2024 grew 64.9% to $477.9 million (KES61.8 billion), driven by strong revenue growth across all business segments. Non-interest income, including earnings from non-banking services, rose 16.5% to $522 (KES67.5 billion), supported by higher foreign exchange trading income.

The acquisition of Riverbank Solutions is a significant step forward for KCB Group as it continues to navigate the rapidly evolving fintech landscape in Africa. As the bank expands its digital capabilities, it is likely to have a profound impact on the region's financial services sector, driving innovation and growth.