Faulu plans Sh113m branch expansion

Faulu Microfinance Bank has announced a Sh113 million branch expansion plan that will see the lender expand its presence across the country.

The plan will see the bank open eight new branches in Ugunja, Kapenguria, Homabay, Kericho, Busia, Voi, Bondo and Limuru.

The micro-lender says it will upgrade its marketing offices into sales and service centers in Taveta, Emali, Iten and Kimilili to enable it offer a wide range of products and services to clients.

Faulu reckons the expansion, which comes at a time when other lenders are moving away from brick-and-mortar branches to focus on digital strategies, will help it build stronger links with Kenya’s local communities while it deepens its relationship with counties and the national government.

“Such partnerships facilitate scalable business models while leveraging economies of scale in our operations.” said managing director Apollo Njoroge.

The SME-focused bank will also refurbish its 15 branches across the country.

Faulu, which was recently feted as the leading microfinance bank of 2019, has recently ran into regulatory and legal headwinds over the conduct of some of its staff.

The Competition Authority of Kenya (CAK) fined the micro-lender Sh150,000 along with Harambee Sacco for making misleading representations on loans issued to their customers.

“In the case of Faulu Microfinance, the penalty was 10 percent of the complainant’s loan value of Sh1.5 million,” CAK told Business Daily earlier.

Separately, three Faulu employees and an auctioneer were charged in court in August over irregular sale of a commercial building belonging to a city trader.

In an ongoing case, they were accused of conspiring to auction the building in Huruma Estate in Eastlands on diverse dates between May 30, 2015 and March 28, 2019.