Old Mutual Adds KES 1.2B Capital to Faulu Bank

In Short

• Old Mutual injected an additional KES 1.2 billion into Faulu Microfinance Bank.
• Faulu is rolling out an upgraded core banking system next week.
• The bank says the upgrade will support better service and more digital lending tools for MSMEs.

What Happened

Old Mutual has added KES 1.2 billion in fresh capital to its Kenyan subsidiary, Faulu Microfinance Bank.

The lender is preparing to deploy an upgraded core banking system next week. A core banking system is the software that runs key bank functions like customer accounts, deposits, payments, and loans.

Faulu said the upgrade is meant to improve service delivery and create a stronger platform for future digital products. The bank also plans to introduce more automation in its lending workflow, including automated loan origination, configurable approval routing, and tighter disbursement controls. In simple terms, that means faster processing with clearer internal checks before money is paid out.

The Business Daily report also notes Faulu’s capital position. The lender closed December with KES 1.33 billion in core capital versus the KES 60 million minimum requirement.

Why It Matters

Kenya’s financial services market is moving quickly toward digital channels, and microfinance banks are under pressure to keep up on speed, reliability, and cost.

For Faulu, investing in core banking technology is not only an IT refresh. It is a way to scale lending and customer service without adding the same level of manual work.

The injection is also a signal of shareholder backing as the lender works to improve profitability. Faulu has not posted a profit since 2019, but the report says losses have narrowed over the past two years.

If the system upgrade delivers, Faulu could improve customer experience and expand MSME credit, a key need in Kenya where small businesses drive jobs and day-to-day economic activity.