Letshego acquires stake in Tanzania’s Advans Bank

BG REPORTER
Friday, 20 November 2015
Letshego acquires stake in Tanzania’s Advans Bank

Letshego Holdings Limited, the financial inclusion-focused group with consumer, micro lending and deposit-taking subsidiaries across Southern and East Africa, has acquired a 75 percent stake in Advans Bank Tanzania by way of a subscription for new shares. The subscription of approximately P70 million is alongside existing shareholders, Advans SA and FMO (the Netherlands Development Finance Company), who will continue to provide on-going governance and oversight.

Letshego already serves over 44,000 Tanzanians through its credit institution, Faidika. Swahili for ‘benefit’, Faidika’s products and services are accessed through a network of 105 branch and satellite offices and a team of more than 230 commission based sales officers. Advans Bank Tanzania was established in Tanzania in 2011 and is part of Luxembourg-domiciled Advans Group. It is a licensed commercial bank specialising in the provision of financial services to micro, small and medium-sized enterprises (MSMEs) in developing countries and transition economies.

The latter includes Tanzania, where Advans’ offering includes MSME loans, as well as current and savings accounts. The bank provides customer access through five branches, three of which are in and around the country’s largest city, Dar es Salaam, as well as through ATMs and third-party agencies. Advans employs over 200 staff who service approximately 23,000 depositors and 4,600 borrowers.

For Letshego Group, the acquisition adds further deposit-taking, payments, business loans, and savings solutions capability to its footprint, in line with its strategy to diversify its customer and revenue mix. Furthermore, Letshego’s acquisition will allow Faidika and Advans Bank Tanzania to contribute significantly to the financial inclusion agenda of the Government of Tanzania by enabling cross-selling of financial services - Faidika has been approved by the Bank of Tanzania as an agent for Advans Bank which will provide Advans customers access to 105 points of access to transact.

Speaking at the press conference this Tuesday, Chris Low, Letshego’s Group Managing Director, said: The Advans Bank acquisition is a clear demonstration of our commitment to providing financially inclusive services to the lower and middle income segments of society that have historically been underserved by traditional banks and lenders.”

He added that Tanzania has made great progress in increasing the availability of infrastructure and enablers for financial inclusion, “so we see this acquisition as a timely opportunity to place Letshego Group at the forefront of supporting the Government’s agenda for economic enablement.”

Brand research commissioned by Letshego across five populous districts of Tanzania found a strong affiliation with the Faidika brand, as a result of its responsible approach to financial services. To ensure wide distribution and market adoption of the integrated operations, the newly acquired bank will be renamed Faidika Bank.

Last modified on Friday, 20 November 2015 11:06

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