Regional lender Absa Bank Kenya is reaping dividends from investing more than Sh1 billion in its digital platforms last year as the firm pushes ahead with its strategy of becoming a digital-first bank.

Data from the lender’s latest financial disclosures indicate that Absa Bank Kenya spent Sh1.16 billion in technology in 2025 with Artificial Intelligence (AI) now embedded across key segments of its business including lending, cyber-security, trade finance and analytics.

This comes as financial services providers in the region stack up billions of shillings in capital expenditure to adapt their businesses to a rapidly changing technological environment.

“We invested KES 1.16bn in technology in 2025, with our digitisation level climbing from 65% to 71%, and 94% of transactions now run on alternate channels”, stated the bank’s management to shareholders in the last annual general meeting. “AI is embedded in multiple workflows and back-office automation has saved more than 80,000 man-hours.”

At the heart of the lender’s latest investment in technology is Absa Next, a cloud-based digital financial platform designed to target the youth population in Kenya between the ages of 20 and 34 and set for full roll out later this year.

“For millennials and GenZs, we continue to build digital lending through our Timiza platform, and we are currently piloting Absa Next, our digital platform for the youth,” stated the firm. 

Absa Next is billed as a new generation lifestyle digital wallet that can operate without being anchored to an Absa bank account and allows users to send money, save, make payments and transact with other digital wallets and fintechs.

The platform will complement the firm’s other digital touchpoints including Timiza and Absa App that have in recent years seen an increase in traction as well as revenue contribution.

According to the firm’s latest financial results, non-funded income grew 12 per cent on the back of digital channels, with revenue from Timiza up 19 percent and nine out of ten transactions now happening outside the branch.

“Customer loans grew to KES 312bn in 2025, and we are growing the higher-quality, higher-margin parts of the book including business banking, LaRiba, Timiza and private banking,” stated the firm’s management in the last AGM. “The strategy is built on sector specialisation, our ecosystem model, and scaling digital lending.” 

The bank’s spending on digital platforms has been increasing year on year and comes at a time when lenders across the board are upgrading up their digital ecosystems in response to rapidly changing technologies and easing of regulatory frameworks. 

Just this year the president assented to the Virtual Assets Service Providers Act which seeks to formalise and regulate the virtual asset ecosystem in Kenya.

“By providing a clear legal framework for Virtual Assets Service Providers, the Act reduces regulatory uncertainty, mitigates fraud and illicit activity risks, and enables market participants to operate transparently,” explains the Capital Markets Authority, CMA in its latest industry report. “This creates a safer, more credible environment for digital asset adoption, supports financial inclusion, and positions Kenya as a regional hub for regulated digital finance and innovation.”

At the moment, financial services providers are adopting a wait and see attitude and guidance from the industry regulator before venturing into providing products and services catering to consumers investing in crypto currencies and virtual assets. 

“We are watching the regulatory space closely, particularly the Virtual Asset Service Providers (VASP) framework being developed in Kenya,” stated Absa Bank. “Once the rules are clear, we will look at compliant ways to serve customers who want regulated access to virtual assets.” 

Absa Bank Kenya is the second largest business of Absa Group outside South Africa and last year reported a 10 percent growth in profit after tax to Sh22.9 billion and 36.5 percent cost-to-income ratio which is among the leading in the industry. Customer deposits on the other hand now stand at Sh372 billion with total assets up 6 percent to Sh537.6 billion.

[email protected]