Kenya’s tier-1 banks have largely exhausted the pool of new digital users, and I&M Group’s disclosure that 98% of its customers now transact digitally shows the next phase of growth will come from extracting more revenue from existing users rather than bringing new ones online.

I&M Group serves more than 727,000 customers across five markets and, with assets of KES 668.9 billion ($5.2 billion), ranks among Kenya’s top-tier lenders, making the figure a strong signal for the wider market.

For years, the banking industry’s playbook focused on moving customers out of branches and onto apps, Unstructured Supplementary Service Data (USSD), and web platforms, cutting costs while expanding reach. 

That shift has cut branch traffic and staffing intensity across the sector, with digital channels now handling the majority of routine transactions such as transfers, bill payments, and balance checks.

Moving banking transactions to digital channels is largely complete across the market. Most tier-one lenders, including KCB Group, Equity Group, and Co-operative Bank of Kenya, say more than 90% of transactions now happen outside physical branches. Few publish figures as high as I&M’s.

Equity Group, the region’s largest lender by customer numbers, has said over 95% of its transactions are processed through digital channels, while KCB has reported similar migration levels across mobile and internet banking platforms.

“The Group’s strong performance is a clear testament to the growing strength, resilience and synergy of our operations across all our markets,” said I&M Group chief executive officer Kihara Maina on Wednesday when the lender reported its full-year 2025 results. 

The change leaves banks facing a different problem: how to make more money from customers who are already fully digital. Transaction volumes may keep rising, but banks are earning less from each transaction as competition intensifies and pricing becomes more transparent across mobile and online channels.

I&M’s latest results suggest one answer is gaining traction. In today’s disclosures, the lender’s non-interest income rose by 31% to KES 14.4 billion ($111 million), outpacing overall revenue growth, while assets under management surged 223% to KES 99 billion ($764 million) as the bank pushed wealth products to its existing base. 

These lines, rather than transaction volumes, are increasingly defining performance in a market where digital access is no longer scarce.

The bank has also expanded its foreign exchange (FX) Direct platform and upgraded its online trading channels, targeting FX flows and cross-border activity that sit naturally atop its digital infrastructure. 

Competitors are moving in the same direction. Equity Group Holdings is expanding investment and insurance products within its ecosystem. KCB Group is pushing deeper into merchant payments after acquiring Riverbank Solutions, alongside its digital credit offering, though execution and pace still vary across players.

Both banks are turning their apps into financial marketplaces, moving beyond basic transactions to bundle lending, savings, insurance, and payments into one place for customers.

What is emerging is a new phase of competition centred on share of wallet rather than user acquisition, as customer growth slows and digital penetration approaches its limit.

Near-total digital adoption means the shift to online banking is largely complete, and banks now have to generate more revenue from higher transaction volumes without pushing customers toward cheaper or simpler alternatives.