History of Kuda Bank
The way Kuda Bank works shows that conventional banks don’t have to spend a lot of money to run network branches. This model also implies a free service for bank customers.
The constant queue of dissatisfied customers in the checkout hall proves the need for a complete digital banking system.
The only institution that comes closest to the need for a digital bank is Kuda Bank. Bank customers can initiate and complete transactions without visiting a physical branch. With this step, Kuda Bank made a clear statement about its identity. It’s not just a mobile wallet or savings app, it’s a real bank. All Kuda Bank deposits are insured by NDIC (Nigerian Deposit Insurance Corporation).
Kuda Bank was founded in 2016 by Mustapha Musty and Babs Ogundeyi. It originally started as Kudimoney, or “free banking,” an online-only savings and lending platform. It has gone through several funding rounds to transform itself into Nigeria’s first digital-only bank with no physical location.
In his comments after Kudimoney received a full banking license from the Nigerian Central bank and transformed into Kuda Bank, Babs Ogundeyi said:
“We’re excited to usher in a new era in consumer banking and serve the many Africans, who we believe are frustrated with traditional banks Starting with Nigeria, we’ll launch a new kind of bank with a continued focus on improving our members’ financial lives rather than trying to burden them with hidden fees and excessive charges”
Kuda believes that anticipating customer needs and offering effective solutions should be the defining motto of the age of digital banking.
An Excellent Model for the Generation “Z”
Kuda Bank’s model is designed for the Gen “Z” and Millennials, who are known to be internet savvy. It offers them the usual banking services no matter their location. The great thing about this service is that the time and stress synonymous with conventional banking is cut down completely.
This entails a general improvement in banking services. For example, interested users simply download the app, sign up, and get a free debit card delivered anywhere in the country within two weeks.
Users no longer have to wait in line at the bank and can resolve complaints from their mobile device without going to the bank teller.
To help customers easily resolve any transaction issues that may arise while using the app, Kuda Bank provides his 30-digit session ID for each transaction.
If something went wrong, you would normally have to call your bank and he would get a 30-digit session ID, but Kuda provides this according to industry standards.
Kuda has an auto-savings option that allows users to automatically save and earn up to 15% interest annually. At Kuda Bank, you never hear about bank fees or card and account maintenance fees that most traditional bank customers fear.
As part of the introductory promotion, Kuda Bank offered 25 free interbank transfers each month to all customers who registered a Kuda account prior to January 1, 2020. After the first 25 transfers, each additional transfer to other banks will cost N10.
Kuda Bank works with his three largest banks in Nigeria to build an extensive branch network that allows customers to deposit funds into her Kuda account for free.
Users may obtain debit cards issued by Access Bank under license from Verve and Visa International.
Babs Ogundeyi, CEO and founder of Kuda Bank, explained that the Kuda model saves banks the high cost of running network branches, which translates into free banking for customers. Speaking at the bank’s launch meeting at the Radisson Blu Hotel Ikeja, he said:
We maintain a high level of security to protect your personal information from unauthorized access. This also allows users to freeze lost debit cards from the app.
Kuda Bank offers other security features such as: Verification mechanism for all users, a breakthrough tool that shows transactions higher than normal range. A back-up system means that if a customer, who normally transfers £50,000, suddenly tries to transfer £500,000, the user will be flagged to warn of a possible error or fraudulent transaction. Working with partners
Kuda Bank partners with Guaranty Trust Bank, Access Bank and Zenith Bank. In addition to partnering with these premium banks, Kuda Bank recently made history as the first Nigerian bank to be included in his P2P payment options on Binance. This allows users who trade cryptocurrencies on Binance to make and receive payments through their Kuda account.
Kuda’s Spend and Save features are the same as those available in other fintech apps. 2% of all user spending is automatically deducted from the balance as emergency fund savings. Like other fintechs, Kuda must perform a KYC function to verify user information against the customer’s Bank Verification Number (BVN).
One of the advantages traditional banks have in all of this is the fact that first-time account holders cannot take advantage of her Kuda services.
Kuda Bank is expected to solve the above problems with its BVN feature that allows it to be independent from other banks. However, there are some uncertainties about the technology to achieve this. Kuda should also consider providing credit. As more players enter the fray (which could happen soon), competition is expected to be based on customer-friendly rates and ability to provide the best service.
Check the official website