Zidisha Bonus Savings Account Qorus Banking Innovation Awards 2014

Savings accounts in the Kenyan market reward customers based on the balances they have in their individual account(s). The offering is homogenous, with innovation mainly happening on the channel of delivery e.g. savings accounts opened and transacted via the mobile phone. As a result, customers with low balances get very low interest rates and consequently choose not to save money. Instead, they opt to pool funds together in groups commonly referred to as ‘chamas’, through which they can invest and earn higher returns in chama accounts or purchase of property etc (the power of many). Based on this unique market behaviour, we identified an opportunity to ‘re-jig’ the savings concept in Kenya, by launching the Zidisha Bonus Savings product, which encourages small savers to come together, pool their funds and in so doing earn higher interest rates. The uniqueness and winning point of the product is that savers do not need to know one another. Therefore, customers earn an interest rate based on the total balance in the product (all customers earn one interest rate), plus a bonus as a reward for their own individual behaviour, through the payment of the bonus interest if no withdrawal is made in a quarter. ‘Zidisha’ is a Swahilii word that means ‘increase’. We chose the name to communicate the concept of customers increasing the returns on their savings. Since launch, the product has grown to over 7,500 accounts with a book balance of over Kes 1.2bn ($14m).