Innovation and entrepreneurship: Impressive success of Kaspi bank in Kazakhstan.

In this day’s dynamic world, innovation and entrepreneurship play a huge role in the
sustainable growth of any banking institution. Kaspi bank, based in Kazakhstan, is the
perfect example of this. Not only it is the fastest-growing company, but also it is the first bank
in Kazakhstan to enter the digital space with a huge success. This essay covers the
establishment of Kaspi bank, its innovative decisions and the effect that it had on the whole
country.

Kaspi bank was founded by Vyacheslav Kim in 2002. At that time his main goal was to
expand his already existing business by giving out loans on his products to customers, and
for that purpose he decided to purchase a bank. But it turned out to be difficult, because he
knew nothing about bank processes. “Every entrepreneur was purchasing a bank, so, I did
the same thing”- says Mr.Kim. But, after struggling with the bank business, he realized that it
is harder than he thought it would be, so he made a decision to find investors. In 2006 (in
some sources 2007) he became a member of an American investing company “Baring
Vostok”. Furthermore, along with making a beneficial deal, he made many useful
acquaintances. And, among them was his future CEO Mikhail Lomtadze.

Mr.Lomtadze is a competent entrepreneur, who changed the banking industry of

Kazakhstan forever. Firstly, he replaced the existing Kaspi team, with new, young employees
full of ideas and potential. Then he got rid of credit cards, because customers were showing
a negative loyalty index. He knew that he would lose the third part of the company's profits
by making this decision, but he wanted to be closer to people and gain their loyalty, so he
decided to take a risk.
A few months later, he introduced the new digital innovation, which was a breakthrough:
from now on, Kazakhstan citizens were able to pay their bills from the phone, through Kaspi
app. They didn't have to stand long lines and overpay the commissions, all they had to do
was simply open an app. The Kaspi app was downloaded by over 8 million people. And then
comes another innovation-each person could send or receive money via Kaspi app, by
simply knowing the phone number of another person, P2P transactions were introduced.
People did not have to go to the bank to transfer money anymore, this process from being
long and difficult went to a couple phone clicks. In 2017, the app was updated, and now
there were maps of every city in Kazakhstan, messengers and international transactions. In
2019, Kaspi offered its payment gateway to stores. Now, most of the stores had Kaspi
terminals, people could pay with a generated Kaspi QR-code, through the app, without being
charged extra. After that came the next step in innovation progress - creating an online
marketplace within the app. In 2020 the number of sellers on the platform was a little over 60
thousands, and the number of active buyers was 3,7 millions. The product that was bought
through Kaspi app could be delivered to the doorstep or picked up for free in Kaspi postmat-
also one of Kaspi's innovations. Nowadays, people could buy anything with Kaspi
installments - food, clothes, technology, restaurant food-without overpaying. They can split
the bill for 3,6,12 or even 24 months, without being charged extra.
But how did the Kazakh government react to the private bank being number one in the
country?

The official representatives of a country did not react well at first, but the entrepreneurship
skills of Mr.Kim were a huge help for getting government approval. Mr.Kim studied politics, in
order to establish a good relationship with the government and show that he is "a real deal".
In 2015, he became a prime-minister's adviser. And later that year Kazakhstan’s president’s
nephew Kairat Satibaldi bought company’s shares (which he sold in 2018), which also was
an endorsing step from the government.
In 2022, Kaspi and digital government portal e-gov made a deal, allowing Kazakh citizens
to make governmental procedures through Kaspi app. Nowadays, people are able to show
their passport or ID card, using the Kaspi app, in case they forget documents at home.
Moreover, they can request government certificates, apply for marriage licenses, pay fines,
receive allowance and salary. In the present time, residents of Kazakhstan are even able to
look for a job on Kaspi app.
And this would not be possible without good entrepreneurship and communication skills of
Mr.Kim.

To conclude, we could see how one person’s decision of expanding his business and his
good innovation and entrepreneurship skills lead to creating a company, which now worth 21
billion dollars. Through its relentless pursuit of innovation, coupled with its entrepreneurial
ventures, the bank has not only transformed its own operations but has also influenced the
broader financial landscape in Kazakhstan. As Kaspi Bank continues to innovate and
expand its reach, it serves as a beacon of inspiration for other financial institutions and
businesses around the world

Resources used:
https://businessfm.kz/business/otkuda-vzyalsya-i-kak-ustroen-kaspi-odin-iz-krupnejs
hih-fintehov-evropy-s-ocenkoj-v-dollar21-mlrd

https://rb.ru/story/kaspi/