Kenya’s digital banking landscape is undergoing a significant transformation, with NCBA LOOP at the forefront of this change. Initially launched as a digital bank in 2017, LOOP has evolved into a broader financial infrastructure model, integrating credit and payments directly into transactions.

This shift aligns with the global trend of embedded finance, where banking services are integrated into everyday commercial activities.

LOOP’s new model enables users to take loans and make purchases in a single transaction, eliminating the traditional separation between lending and payments.

According to Eric Muriuki, CEO of LOOP, this evolution is a response to both global trends and local market pressures. “We are developing our solutions and observing trends here at home and in other parts of the world that we consider relevant,” he explained.

As one of Kenya’s earliest digital banks, LOOP helped popularize neobanking in the country. However, with the rise of well-funded competitors, LOOP is expanding its offerings beyond digital banking into a payments and credit infrastructure model.

Muriuki noted that this shift is driven by the recognition that payments and credit are increasingly intertwined. “Payments and credit will not be two different businesses, particularly short-term credit, because short-term credit is typically used to pay for something,” he said.

The benefits of embedded finance extend beyond consumers to businesses, particularly in trade and commerce. “If you want to pay a supplier in China for imported goods, that payment transaction can have a credit structure embedded into it,” Muriuki added.

As the financial landscape continues to evolve, Muriuki predicts that the distinction between neobanks and traditional banks will persist, but the boundary will become thinner. Digital platforms will continue to gain market share in consumer banking, especially among digitally native customers.

For corporate clients, embedded finance will reshape value chains, with businesses maintaining relationships with traditional banks while integrating their financial operations with digital platforms. However, regulatory constraints will ensure that banks remain a central part of the financial system.