Financial inclusion in sub-Saharan Africa has improved considerably in recent years, with bank account ownership doubling from roughly 23% of the adult population in 2011 to 49% by 2022, according to the World Bank. Still, hundreds of millions of adults in sub-Saharan Africa do not have a bank account.
Countries like Kenya show that it is possible under the right conditions to deliver formal financial services to previously unbankable populations – and to do so through a scalable, commercial model. Propelled by the rapid adoption of mobile money and digital services, Kenya’s financial inclusion rate today stands at 84% of the adult population from just 27% two decades ago.
James Mwangi, the group MD and CEO of Equity Group Holdings, the parent company of Equity Bank Group and other financial services operations, is considered one of the principal architects of this transformation. He joined the bank as a finance and operations director in the 1990s, when it was a struggling building society, and helped re-engineer its business model to make it work for the unbanked.
At a time when most of its peers were scrambling to drum up business from large corporates, public sector clients and high net-worth individuals, Mwangi went after those who had long been overlooked due to their perceived high credit risk – low-income earners, small-scale farmers and micro-entrepreneurs.
By the time Mwangi took over as CEO in 2004, this strategy had paid off and the bank had found a formula to profitably scale the business model.
He says the secret of the bank’s success was to restore the dignity of people who had been shut out of the banking system because they were considered too poor or too small.
“It is clear to everybody in Equity Bank that we are in it to lift the dignity and the lives of the people – and to give them an opportunity to build their lives economically,” he says.
This was his primary motivation when he got involved with the bank and remains Equity Bank’s ethos more than three decades later.
While its strong focus on small businesses and retail clients continues to be an integral part of its DNA, it has since evolved into a systemically important financial institution that also supports large corporate clients and governments.
“We are home to up to 60% of all the bank accounts in some of the markets that we operate in. As a result we have grown to hold a $16.5bn balance sheet – with a single lending obligor of $750m. That means we have the capacity and the competence to fund infrastructure and to fund corporates,” he says.
Equity Bank opened its first branch outside Kenya in 2008, when it entered Uganda through the acquisition of a local microfinance bank. Since then, it has progressively expanded its regional footprint through a mix of acquisitions and organic strategies, establishing profitable operations in Tanzania, Rwanda, South Sudan and the Democratic Republic of the Congo (DRC).
Mwangi says that the bank’s entry into DRC, where it operates as Equity BCDC, is proving to be inspired. The subsidiary has emerged as the bank’s second-largest contributor to revenues and profits after Kenya. In the third quarter ended September 2025, DRC generated profits before tax of Kshs17.7bn ($137.21m), up 18% on the prior year. By contrast, Kenya generated pre-tax profits of $274.42m, Rwanda delivered $42.64m, Uganda $27.13m, Tanzania $14.73m, and South Sudan $780,000.
“When we entered the DRC market in 2015, it was where Kenya was in the 1990s. Only 6% of the population had bank accounts, so 94% of the population was excluded. We brought in the lessons that we had built for nearly 30 years in Kenya, and as a result, we were very innovative and creative in approaching that market,” he says.
He notes that the bank had to overcome several challenges in DRC before finding the recipe for success. “There were certainly constraints that were different from what we had encountered in Kenya. DRC is almost a subcontinent, it does not have fully developed infrastructure and we had language and culture barriers that we had to deal with.”
Mwangi acknowledges the role played by the country’s regulators and policymakers in creating a conducive environment for the bank to innovate and grow. “The regulatory framework had not gone through reforms for many years and could not allow innovations, modernisation and digitalisation,” he recalls.
“We worked very closely with the regulators to reform the framework; we saw 16 amendments to the Banking Act made, and that allowed us to then bring in all the innovations we had built in East Africa,” he says.
Mwangi hopes that Equity Bank can replicate the success it has enjoyed in DRC in Ethiopia, where it is currently in talks with the authorities to obtain a licence to start full-scale operations after opening a representative office in Addis Ababa in 2019. Like DRC, Ethiopia’s appeal lies in the size of its population and the potential to bring financial services to businesses and individuals that have long been underserved.
“We entered the Ethiopian market seven years ago with a representative office and have been learning the market conditions. It has not been open to international banks, but recently, amendments and proclamations were made to open the market,” he says. “We are now here studying how we can convert our licence into a fully-fledged banking licence so that we can do intermediation in the market.”
Kenya getting more competitive
In its core market of Kenya, however, Equity Bank is facing increased competition following a wave of consolidation that has seen Nigerian and South African rivals bid for controlling stakes in Kenyan banks.
Nigeria’s Access Bank completed its takeover of the National Bank of Kenya (NBK) from KCB Group in April 2025, marking its formal entry into East Africa.
A few months later, Zenith Bank, Nigeria’s second-largest bank by assets, entered advanced talks to acquire Paramount Bank Ltd, a mid-sized Kenyan lender. In January, Nedbank Group of South Africa announced plans to acquire a 66% controlling stake in NCBA Group, one of the country’s largest banks, in a deal valued at R13.9bn ($856m).
Mwangi welcomes the increased competition, arguing it is a sign that the market is maturing and that the economy has the capacity to absorb the kind of large-scale financing that can drive rapid development.
“It is clearly that the Kenyan banking industry is maturing. As a result, there is massive consolidation. We have seen the big South African and Nigerian banks drive that consolidation. That to me reflects the maturity of the market and points to the likelihood of the market getting more competitive,” he says.
“But it also means that the size of the economy allows large-scale balance sheets to be deployed. It also means that the private sector has grown in size and is providing opportunities to the financial sector. And lastly, it points to indications that the economy might be on the verge of takeoff and we require massive amounts of capital,” he adds.
The AI factor
With 98% of all of Equity Bank’s transactions happening on digital platforms, technology has become a critical driver of competitiveness for the bank. Mwangi contends that this will remain the case in view of how emerging technologies like artificial intelligence (AI) are reshaping the sector.
“The biggest change that the financial sector and bank leaders are going through is technological change. I think we are now living in the era of AI. It was very good to be digital-first, but now we are changing to be AI-first,” he says.
He reveals that Equity Bank is already harnessing AI and machine learning to transform decision-making and customer satisfaction.
“We have adopted AI so that we harness the data that we are collecting from digital processes. We have adopted machine learning so that we now start driving decisions from artificial intelligence,” he notes.
“That then allows us ultimately to provide personalised, individualised solutions, because we understand customers at the personal level – as opposed to a segment level. We must speak to the needs of an individual, and only AI can allow us to understand and know the customer at a personal level,” he explains.
Equity Bank aims to catalyse development
Mwangi sees Equity Bank Group as more than just a provider of banking services. For him, it is a catalyst for development and transformation across Africa. In line with this, the Group has become a strategic partner to some of the largest and most influential development financial institutions operating in Africa.
He points to the $500m agreement that the bank signed with the African Guarantee Fund (AGF) last year to unlock greater financing for SMEs. “This was to enable us to de-risk micro, small and medium- sized enterprises and ensure that they are not left behind.”
Equity has also mobilised roughly $1.5bn in long-term capital from partners including the African Development Bank, France’s Proparco, Germany’s KfW, and the World Bank’s IFC. The funds are earmarked for companies engaged in export-oriented manufacturing.
He notes that the bank has also forged partnerships with development partners to help unlock access to financial services for refugees, “who have long been excluded from formal financial services because of their legal status”.
“We felt they were part of society and needed to be included,” he explains. “We have lobbied a lot, and working with UNHCR, we have made a major breakthrough. They are now allowed to open bank accounts on mobile phones and broadly be given an identity.”
As a result, Equity Bank is present in all refugee camps in East and Central Africa, working with a combination of physical branches, agents and mobile banking to provide services to customers. Backed by a $20m guarantee facility from IFC to de-risk lending, the bank has issued 450,000 loans to refugees in the region.
Mwangi notes that this initiative has in recent years helped cushion refugees from the impact of shrinking aid budgets. “I’m glad we ventured into that sector six years ago, because we have seen how aid has drained away. UNDP used to be a big driver because it was supported by USAID but now those programmes have come to an end. Refugees could have been fully exposed [to the fallout], but now they are involved in economic activities,” he says.
What motivated him to extend banking services to refugees? He points to his own upbringing in rural Kenya where economic marginalisation instilled in him a deep sense of empathy for those excluded from opportunity.
“Having been brought up in a very humble background and environment helps me to understand the circumstances of refugees and wish to do something big for them.”