Fountain Credit Services, a Kenya-based company specialising in microfinance, has adopted cloud services from banking software firm Temenos, making it the first financial institution in Kenya to adopt cloud technology.
Fountain was founded in 2011 and currently has 20 offices in Kenya, including its headquarters in Nairobi. The company aims to reach the estimated 14 million rural and urban Kenyans that are currently unbanked, using technologies such as mobile banking.
To keep its running costs low, the company has chosen TEMENOS T24, a managed service hosted in Europe that will allow it to offer credit and lending in the cloud without having an on-site system. Fountain will use Temenos’ services on a pay-per-use model. The idea is to reduce start-up costs as well as operating costs by removing the need for on-site technology installation and maintenance.
“Procuring T24 from the cloud brings with it huge economic benefits and provides Fountain with the scalability and flexibility to grow with our customers’ demands,” said Arch Kithaka, chief executive at Fountain Group.
As a precaution against fraud, which cost financial institutions in the region an estimated US$48 million in the last 18 months according to research firm Deloitte, T24 contains fraud detection abilities.
Kenya is also the home of M-PESA, a mobile banking service which has gained international attention based on its success in banking the unbanked. M-PESA allows users to send and receive money on their mobile phones – a useful ability, in a country with high penetration of mobile handsets but low penetration of traditional branch-based banking services.