Banks take digital banking race into investment, wealth creation

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Banks are expanding digital banking into investment services as competition for retail investors grows and financial institutions seek new ways to attract customers through mobile platforms.

The shift is changing how financial institutions compete for customers as investment products become part of the services offered alongside payments, savings, and credit.

Kenya's collective investment schemes industry has recorded strong growth, with assets under management rising from Sh389.2 billion in December 2024 to Sh948.7 billion in June 2026, according to the Central Bank of Kenya.

The number of investors in the schemes also increased from 1.41 million to 4.15 million over the same period, reflecting growing participation in professionally managed investment products.

The expansion has attracted technology companies seeking to connect retail investors with licensed fund managers through mobile applications. In May 2026 the Capital Markets Authority (CMA) licensed two intermediary service platform providers to expand digital access to collective investment schemes.

One of the licensed platforms is Chumz, which connects retail investors to collective investment schemes, while Pesa Bridge provides digital infrastructure linking investors with licensed fund managers and custodians.

Mobile money providers are also expanding into investment services as they seek to diversify beyond payments and transfers.

The developments are creating new distribution channels for investment products and increasing competition among banks, fintech companies, and traditional fund managers.

Against this backdrop, Absa Bank Kenya has added five unit trust funds to its Absa Next digital banking platform, allowing customers to start investing with as little as Sh1,000.

The funds comprise the Absa Balanced Fund, Absa Shilling Money Market Fund, Absa Dollar Money Market Fund, Absa Equity Fund and Absa Fixed Income Fund. They cater for different investment goals and risk profiles.

The expansion also comes as regulators seek to strengthen investor protection amid the rapid growth of the unit trust market. In October 2026, the CMA announced plans to introduce risk ratings for money market funds and other investment products to help investors understand the risks associated with their investments.

Launched in September 2026, Absa Next has attracted more than 300,000 users, according to the bank.

The platform initially offered everyday financial services, including bill payments, digital savings, bill splitting and instant day-one credit.

The investment feature allows customers to open accounts digitally and link existing Absa Unit Trust investments.

They can also create multiple portfolios for different financial goals, top up their investments, access account statements and monitor portfolio performance through their phones.

For customers investing in the Shilling Money Market Fund, qualifying redemptions can be transferred to an Absa Wallet in real time.

Speaking on the expansion, Moses Muthui, Director of Personal and Private Banking at Absa Bank Kenya, said the bank was responding to demand for more accessible investment services.

“With investments starting from as little as KES 1,000, we are making wealth creation more accessible and inclusive,” he said.