How often do you lease property? How flexible are the terms of lease? NIC Bank is looking to make you relate better to leases with a new leasing subsidiary, NIC Leasing Limited Liability Partnership, in a bid to tap into the growing opportunities in the leasing market.
Being the first of its kind in the market, the subsidiary will now enable the group to offer customers the asset, their financing solutions as well as insurance through their Bancassurance subsidiary. The Bank received approvals from the Central Bank of Kenya to set up the subsidiary in December 2014.
The operating model employed by NIC Leasing LLP is unique and a first in the domestic market. The model will see NIC Bank partnering with Mercantile Finance, another wholly owned subsidiary of the bank.
NIC’s move to set up the new subsidiary fits into the Bank’s aggressive growth strategy, especially in the Asset Finance space, which has become very competitive over the last few years. With Leasing slowly gaining traction in the Kenyan market, leasing initiatives by the Government are a positive move towards growing the market.
Leasing offers companies various advantages including optimised cash flow management by freeing up capital which can be invested in other areas of the business. The subsidiary will mainly be looking at assets such as motor vehicles as well as focusing on leasing equipment in the FMCG, Construction and Healthcare sector.
The bank previously linked customers with leasing companies and provide the financing. With NIC leasing, the bank will now provide the equipment as well as financing. The bank will offer professional services from inception, during the lease and at the end.