James Mwangi
Kenya
James Mwangi
  • CBS, Group CEO, and Managing Director, Equity Group Holdings Plc (Financial Services)
Born Kangema, Kenya, 1962; Bachelor of Commerce (BCom), University of Nairobi.
“That is why Equity was credited with the democratizing of financial access in Kenya—it disrupted the banking environment from the top side down.”

Summary

In this interview, James Mwangi, CEO of Equity Bank, narrates his entrepreneurial journey building one of Kenya’s biggest and most inclusive banks, and discusses his driving mission to give back to Kenyan society through education.

Mwangi begins by discussing the state of the banking sector at the start of his career in the early to mid-1980s. He describes the numerous obstacles—from compliance requirements to fees to access to liquidity—that barred many people from opening bank accounts. Moreover, he explains how, after Kenyan independence in 1963, there were very few consumer-facing banks, because the government focused on developing banks aimed at serving state corporations, rather than the Kenyan population. Mwangi experienced the results of this exclusion at first hand during his childhood, when his mother—along with many other people in his village—was deemed ineligible to open a bank account. By the time he got his first job, Mwangi explains, “I really understood that exclusion from the financial system was exclusion from resource allocation. That was a turning point.” Indeed, his desire for equal access to banking services became a major motivating factor throughout his career.

He goes on to explain the circumstances in which he got involved with Equity Bank—which was originally a building society. After 11 years, it was struggling and facing insolvency, yet Mwangi immediately recognized the resilience and determination of the employees. Said Mwangi, “The turnaround of Equity”—which happened in just a year—“was driven by that spirit. It was all about that human spirit, that determination.” Today, Equity Bank is one of the biggest in Kenya, serving over 50 percent of the population.

Key in the recovery and subsequent growth of Equity Bank was Mwangi’s focus on improving interactions with customers. Previously, he explains, clients “were made to feel that [their] value to the bank was based on [their] account balance.” At Equity, Mwangi strove to “give banking a human face.” As he explains in the interview, all customers—regardless of wealth or background—were treated with dignity. “People are more human than economic. That’s the conclusion I have today—that it’s how you treat them, it’s not what you give them that matters.” As Mwangi goes on to explain in the interview, this relationship with clients—built on a foundation of mutual respect—was also key to helping previously disenfranchised Kenyans build savings accounts and credit history. Mwangi talks at length about how the group build up these different microfinance and microcredit services, and the reasons that they have been so successful.

Mwangi goes on to discuss some of the challenges Equity Bank faced as it grew, including lack of necessary infrastructure, corruption, political risk, and the absence of a skilled labor force. In the interview, Mwangi explains some of the strategies Equity has used to navigate these and other challenges. He also reflects on new challenges, including digitization, telecommunications, and e-commerce, and how these new technologies have revolutionized the consumer experience.

Concluding the interview, Mwangi shares his philosophy on corporate social responsibility and discusses some of the activities of the Equity Bank Foundation, most notably, its work in the areas of education and leadership development.

 Read more

In this interview, James Mwangi, CEO of Equity Bank, narrates his entrepreneurial journey building one of Kenya’s biggest and most inclusive banks, and discusses his driving mission to give back to Kenyan society through education.

Mwangi begins by discussing the state of the banking sector at the start of his career in the early to mid-1980s. He describes the numerous obstacles—from compliance requirements to fees to access to liquidity—that barred many people from opening bank accounts. Moreover, he explains how, after Kenyan independence in 1963, there were very few consumer-facing banks, because the government focused on developing banks aimed at serving state corporations, rather than the Kenyan population. Mwangi experienced the results of this exclusion at first hand during his childhood, when his mother—along with many other people in his village—was deemed ineligible to open a bank account. By the time he got his first job, Mwangi explains, “I really understood that exclusion from the financial system was exclusion from resource allocation. That was a turning point.” Indeed, his desire for equal access to banking services became a major motivating factor throughout his career.

He goes on to explain the circumstances in which he got involved with Equity Bank—which was originally a building society. After 11 years, it was struggling and facing insolvency, yet Mwangi immediately recognized the resilience and determination of the employees. Said Mwangi, “The turnaround of Equity”—which happened in just a year—“was driven by that spirit. It was all about that human spirit, that determination.” Today, Equity Bank is one of the biggest in Kenya, serving over 50 percent of the population.

Key in the recovery and subsequent growth of Equity Bank was Mwangi’s focus on improving interactions with customers. Previously, he explains, clients “were made to feel that [their] value to the bank was based on [their] account balance.” At Equity, Mwangi strove to “give banking a human face.” As he explains in the interview, all customers—regardless of wealth or background—were treated with dignity. “People are more human than economic. That’s the conclusion I have today—that it’s how you treat them, it’s not what you give them that matters.” As Mwangi goes on to explain in the interview, this relationship with clients—built on a foundation of mutual respect—was also key to helping previously disenfranchised Kenyans build savings accounts and credit history. Mwangi talks at length about how the group build up these different microfinance and microcredit services, and the reasons that they have been so successful.

Mwangi goes on to discuss some of the challenges Equity Bank faced as it grew, including lack of necessary infrastructure, corruption, political risk, and the absence of a skilled labor force. In the interview, Mwangi explains some of the strategies Equity has used to navigate these and other challenges. He also reflects on new challenges, including digitization, telecommunications, and e-commerce, and how these new technologies have revolutionized the consumer experience.

Concluding the interview, Mwangi shares his philosophy on corporate social responsibility and discusses some of the activities of the Equity Bank Foundation, most notably, its work in the areas of education and leadership development.

Download Interview Transcript

Video Clips by Topic

Corruption

James Mwangi, CEO of Kenya’s Equity Bank, which has one of the largest customer bases of any bank in Africa, argues that the lack of financial literacy posed a far bigger challenge to the bank in Kenya than problems of corruption.


Education

James Mwangi, CEO of Kenya’s Equity Bank, which has one of the largest customer bases of any bank in Africa, explains the work of the Equity Group Foundation, which he founded and leads, in promoting financial inclusion, entrepreneurship and leadership skills, and the granting of thousands of educational scholarships.
Keywords: Education, Kenya


Global Expansion

James Mwangi, CEO of Kenya’s Equity Bank, which has one of the largest customer bases of any bank in Africa, explains the challenges faced by his bank as it expanded into neighboring countries, especially lack of infrastructure, security and politics


Government and Business

James Mwangi, CEO of Kenya’s Equity Bank, which has one of the largest customer bases of any bank in Africa, explains his bank’s determination to remain neutral in the highly polarized Kenyan political environment.


Innovation (1)

James Mwangi, CEO and Managing Director of CBS Group and Equity Group Holdings, discusses innovation in microfinance business models in Kenya.

Keywords: Innovation, Kenya


Innovation (2)

James Mwangi, CEO of Kenya’s Equity Bank, which has one of the largest customer bases of any bank in Africa, discusses how the Equity Bank model evolved through learning both from Asian companies and from the bank’s own customers.
Keywords: Innovation, Kenya


Social Impact

James Mwangi, CEO of Kenya’s Equity Bank, explains that both international and state-owned banks failed to address the issue that 96 percent of the population had no bank accounts in post-colonial Kenya, and how Equity Bank was able to dramatically expand financial inclusion.
Keywords: Social Impact, Kenya


Full Length Video (login required)

Additional Resources

Additional Resources

Interview Citation Format

Interview with James Mwangi, interviewed by Tarun Khanna, Boston, MA, April 24, 2018, Creating Emerging Markets Project, Baker Library Historical Collections, Harvard Business School, http://www.hbs.edu/creating-emerging-markets/.