Co-operative Bank plans to tap its customer base to attract new business for the leasing subsidiary Co-op Bank Fleet, which it co-owns with South Africa’s listed firm Super Group.
Chief executive Gideon Muriuki said targeted transport solutions would enable customers ease operational costs by leasing vehicles for operations when the need arises and free monies for use in core business activities.
“This partnership between Co-op Bank and Super Group will tap into the synergies created by the joint venture to better support our customers in asset acquisition, technologies and equipment,” said Mr Muriuki.
The subsidiary now servicing its first Sh890 million leasing deal for financing and delivery of a fleet of 125 vehicles to the Ministry of Interior, said the new strategy would see private sector players offered packages that reduce expenses while meeting daily transport needs.
Leasing Association of Kenya Chairperson Edna Kihara said leasing eased cash-flow challenges for firms to concentrate on core business while allowing other firms to shoulder maintenance and repair costs for their leased fleet.
“Instead of spending all your money buying fixed assets, leasing the needed equipment is far much cheaper and enables you to lease more equipment, hence higher production,” she said.
Emerging trends show more firms and public entities are leasing vehicles and equipment on monthly instalments, which is cheaper than buying of assets.
Super Group will help to screen customers, innovate products that respond market needs while targeting SMEs, saccos and the public sector.