How resilient are banks to COVID-19 effects?

The COVID-19 pandemic has brought about unprecedented challenges for various sectors worldwide, including the banking industry. As some countries like China, Austria, and Denmark begin to slowly open up, experts believe that the long-term effects of the pandemic on sectors such as banking are just beginning to surface. CNBC Africa recently spoke to George Odhiambo, the Managing Director of KCB Rwanda, to shed light on how banks are navigating these turbulent times. Odhiambo highlighted the multi-pronged approach that KCB Rwanda has taken to ensure the safety of its staff and customers amidst the pandemic. The bank has scaled down its operations, with more than 70% of its staff working from home and only essential services being offered. Several branches and centers have been temporarily closed in compliance with necessary lockdown procedures. In response to customer concerns, KCB Rwanda has focused on ensuring that payment systems remain functional and has relaxed requirements for loan restructuring processes, accepting email requests in lieu of physical documentation. Digital platforms such as mobile phone banking and internet banking have been emphasized to provide customers with more accessible and convenient services. Additionally, KCB Rwanda has contributed 100 million Rwandan francs towards the COVID-19 pandemic fund, aimed at supporting the government's efforts in combating the spread of the virus. The bank has also implemented an internal stimulus package to assist customers who are facing challenges in meeting their debt obligations. Odhiambo underscored the vital role of central banks in supporting lenders like KCB Rwanda during these trying times. Central banks play a crucial role in facilitating the distribution of stimulus packages and providing regulatory guidance to ensure the resilience of the banking sector. Odhiambo commended the actions taken by the Central Bank of Rwanda, such as reducing interest rates and establishing funds for liquidity support, to help banks cope with financial pressures. Despite challenges with technology infrastructure and online platforms, Odhiambo noted an increase in digital transactions and usage compared to the same period last year. KCB Rwanda has prioritized customer service by addressing technology-related issues promptly and ensuring the safety of customers in banking premises through enhanced hygiene measures. The bank remains committed to supporting businesses and individuals in Rwanda through these uncertain times, with a focus on innovation, adaptability, and partnership with regulatory bodies like the Central Bank of Rwanda.